DCF Calculator — Discounted Cash Flow NPV

Discount a stream of future cash flows back to today at a rate you choose, and see the net present value plus what each year contributes.

How to use
  1. Enter the projected cash flow for each year.
  2. Set the discount rate.
  3. Read the net present value and the yearly contributions.
Frequently asked questions
What discount rate should I use?
The return you could get elsewhere at similar risk. For company valuation that is usually the weighted average cost of capital; for a personal decision, your own hurdle rate.
Why does the rate matter so much?
Because it compounds. Over ten years, moving from 8 to 12 percent cuts the present value of the final year's cash flow by more than a third.
What about cash flows beyond the forecast?
Those go in a terminal value, which routinely makes up most of a valuation. Add it as a final year figure rather than pretending the business stops.
Is a positive NPV enough to proceed?
It is necessary, not sufficient. A small positive number sits well inside the error bars of any forecast, so treat it as a close call rather than a green light.
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