The Analyst’s Course · Valuation & DCF
The Full Valuation Workflow — From Statements to a Defensible Range
Steps 1–3: the engine room
Step 1 — WACC from live inputs: the panel's builder loads the current 10-year; set beta from the profile; choose ERP 4–5% (implied) and justify; set debt weight from actual structure. Step 2 — FCF base from filed statements only (CFO + capex), never company-adjusted. Step 3 — growth and fade: start from history (what did FCF actually compound at?), set the fade toward nominal GDP, sanity-check any growth above the company's best 5-year run.
Steps 4–6: the honesty layer
Step 4 — terminal: g at or below nominal GDP; convert to implied exit multiple; flag TV >75% of EV and reduce horizon-fantasy accordingly. Step 5 — the grid: read level, gradient, and where the live price sits inside your assumption space. Step 6 — comps: vet the peer set, rebuild to GAAP, price the median; extremes need explanations, not adjectives.
Steps 7–8: the verdict
Step 7 — reverse check: what growth does the price imply, and does history contain it? Step 8 — write the range and the two-sentence thesis: "Fair range $X–Y under WACC a–b% and g c–d%; the price requires growth I do/don't believe because ___." That sentence is the deliverable. The graded exercise walks the full loop on a live ticker — and the exam below certifies you on the pieces.
What the range buys you
Institutions that survived 2000 and 2022 with capital intact share one habit: they acted on ranges and pre-committed responses ("if it enters $X–Y, we size up; below Y, we investigate solvency"). Ranges convert volatility from an enemy into a schedule. Point estimates convert it into panic. The workflow exists to produce the former.
What you'll practise
The FCF base must come from…
3 graded checkpoints · certification exam at the end of the track
Sources
Damodaran (ERP data); Mauboussin, ATKM; McKinsey Valuation; IPO prospectuses (SEC S-1 filings)
Learn content is for education only — not individualized financial advice, a recommendation, or a solicitation to buy or sell any security. Options involve substantial risk. Examples are simplified and historical patterns never guarantee future results.