Discounted Cash Flow Analysis

Discounted Cash Flow (DCF) Analysis is a method used to evaluate the value of an investment or company based on its expected future cash flows. It involves estimating how much money the investment will generate over time and then adjusting those amounts to account for the fact that money today is worth more than the same amount in the future due to inflation and opportunity costs. By discounting future cash flows back to their present value, investors can assess whether an investment is likely to be profitable and make more informed financial decisions.