42 thoughts on “Understanding Discounted Free Cash Flow – DCF Questions and Answers

  1. As a engineering college student taking a course in finance, your content is really simple to understand for beginners and I can relate to it! Keep up the amazing job Jimmy 🙂

  2. Hey jimmy would it be more accurate to use fcf to equity (since it’s after debt repayments) to make future fcf projections instead of simply using operating cf – capex

  3. Hello , Jimmy. Congrats on the channel, your content is priceless to me. I have a question regarding the FCF estimates : from which websites/ analists are you taking the FCF estimates ? I am trying out your excel template for different companies and would help me a lot to know your sources.

    Keep it up.

  4. Hi Jimmy, how do I evaluate REITs ? So I can better decide which one will be the best investment in the long run?
    Thanks

  5. I just want to thank you for making these videos. I don't have any type of accounting background. (powerline worker lol) I read the 10k's, 10q's, earnings calls, balance sheet. But the cash flow and income statement is what I struggle with. (how to analyze them).thanks.

  6. Why only operation's and investment's cash flows are used to calculate free cash flows why don't we consider cash flows from financing activities in that calculation?

  7. I get notification about this video on my phone 2 days ago. I liked it and saved and watching now during the weekend. Thanks Jimmy <3
    P.S. Could you please make a video about the DCF sheet that you generously shared earlier? It is comprehensive but I find it intimidating because I don't feel I get the results right.

  8. I've been using Jimmy's Excel template since I began stock valuation. It's been an integral part of my analysis and I would highly recommend his channel and content.

  9. Jimmy, thank you for very useful video! Jimmy, what do you think about water companies such as AWK, Middlesex Water Company or York water company. Is this a good investment on 5-10 years horizon. Would be great if you will make a video about new opportunities on the market in 5-10 years timeline. Thank you once again

  10. There's a lot of value in every video you post, congrats. By the way at 15:10 the price per share is incorrect, but it is not relevant for the point you made

  11. how do you decide on the growth rate for FCF? Do you go off of analyst's estimates (if so what's your preferred site) or do you use a fundamental growth rate?

  12. Hi Jimmy, where do you normally go to find analyst estimates? If it is from a paid subscription, which website do you think offers the best service for their price?

  13. Great information. I usually use 5 years for my analysis. Doesn't make much since to do longer. Things can just change to much. Great Video! 😀

  14. Just a tip for you Jimmy- I've noticed a lot of other financial youtubers avoid saying 'coronavirus' at all costs because it gets their videos demonitized. Not sure if your videos don't have ads on purpose or if that's demonitization but you provide us with a lot of value and deserve to make a profit from your videos.

  15. Hey Jimmy, I turned your DCF calculation video into code and was able to get it working for any company using an API. One thing I noticed using the WACC formula with the current 10yr treasury rate is that the return rate was very low resulting in the purchase price of the company being very high, for example Walmart returned a purchase price of $1,600 based off the WACC formula. Do you know the explanation for this?

  16. On that topic, I'll more than appreciate if you follow up with a few videos valuing a number of companies, it is probably especially useful now that there's a correction in the market. Hopefully if folks like that, then like this comment to get Jimmy's attention and perhaps reply with a few suggested stocks to analyze.

  17. Which is the method for irregular FCF? I'm working on a project which its 3 first years are negative (outflows) because is just investment and from year 4 onwards positive cash flows. Can I use this method in that scenario?

    Thank you! Great video!

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