{"id":6931,"date":"2022-11-01T13:07:43","date_gmt":"2022-11-01T13:07:43","guid":{"rendered":"https:\/\/rakshithpai.com\/?p=6931"},"modified":"2022-11-01T13:14:04","modified_gmt":"2022-11-01T13:14:04","slug":"discounted-cash-flow","status":"publish","type":"post","link":"https:\/\/rakshithpai.com\/discounted-cash-flow\/","title":{"rendered":"Discounted Cash Flow &#038; its Importance:"},"content":{"rendered":"\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-662e650c49b31\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\" style='display:none' id=\"ez-toc-cssicon-toggle-item-662e650c49b31\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/rakshithpai.com\/discounted-cash-flow\/#Introduction_to_Cash_Flow\" title=\"Introduction to Cash Flow:\">Introduction to Cash Flow:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/rakshithpai.com\/discounted-cash-flow\/#What_is_Discounted_Cash_Flow_DCF\" title=\"What is Discounted Cash Flow (DCF)?\">What is Discounted Cash Flow (DCF)?<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/rakshithpai.com\/discounted-cash-flow\/#Discounted_Cash_Flow_Formula\" title=\"Discounted Cash Flow Formula:\">Discounted Cash Flow Formula:<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/rakshithpai.com\/discounted-cash-flow\/#How_Does_Discounted_Cash_Flow_DCF_Work\" title=\"How Does Discounted Cash Flow (DCF) Work?\">How Does Discounted Cash Flow (DCF) Work?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/rakshithpai.com\/discounted-cash-flow\/#How_to_Calculate_DCF_Analysis\" title=\"How to Calculate DCF Analysis?\">How to Calculate DCF Analysis?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/rakshithpai.com\/discounted-cash-flow\/#Where_do_we_use_the_DCF_model\" title=\"Where do we use the DCF model?\">Where do we use the DCF model?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/rakshithpai.com\/discounted-cash-flow\/#Advantages_of_Discounted_Cash_Flow\" title=\"Advantages of Discounted Cash Flow:\">Advantages of Discounted Cash Flow:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/rakshithpai.com\/discounted-cash-flow\/#Disadvantages_of_Discounted_Cash_Flow\" title=\"Disadvantages of Discounted Cash Flow:\">Disadvantages of Discounted Cash Flow:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/rakshithpai.com\/discounted-cash-flow\/#Conclusion\" title=\"Conclusion:\">Conclusion:<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/rakshithpai.com\/discounted-cash-flow\/#Also_read\" title=\"Also read:\">Also read:<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Introduction_to_Cash_Flow\"><\/span><strong>Introduction to Cash Flow:<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong>&#8220;Cash flow&#8221; is used to describe the net inflow and outflow of currency for a business. Money coming in and money going out are referred to as inflows and outflows, respectively.<\/strong><\/p>\n\n\n\n<p>The capacity to produce positive cash flows, and more especially to optimize long-term free cash flow, is central to a company&#8217;s ability to create value for its shareholders (CFC). Free cash flow (FCF) is the cash flow remaining after a firm deducts the cost of capital expenditures from its regular operating cash flow (CapEx).<\/p>\n\n\n\n<p><strong>FCF formula = Net Cash Flow From Operations (-) Capital Expenditure<\/strong><\/p>\n\n\n\n<div class=\"wp-block-buttons is-horizontal is-content-justification-center is-layout-flex wp-container-core-buttons-is-layout-1 wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button is-style-outline\"><a class=\"wp-block-button__link has-text-color has-background\" href=\"https:\/\/zerodha.com\/open-account?c=PR4768\" style=\"border-radius:50px;background-color:#e4fa00;color:#0f0027\" rel=\"nofollow\"><strong>Open Zerodha Account Now!<\/strong><\/a><\/div>\n<\/div>\n\n\n\n<p>Capital Expenditure includes all &#8220;Property Plant &amp; Equipment&#8221; expenses as well as the cost of depreciation over the years.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_Discounted_Cash_Flow_DCF\"><\/span><strong>What is Discounted Cash Flow (DCF)?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Investments may be valued with the use of the discounted cash flow (DCF) analysis approach by discounting their anticipated future cash flows. <strong>Since DCF analysis may be used to determine the worth of a broad variety of investments, projects, and other endeavors, it is frequently employed in the investing world and by corporate finance managers.<\/strong><\/p>\n\n\n\n<p>After taking into account the passage of time and other factors. Discounted cash flow analysis can provide a reasonable estimate of the value of the investment&#8217;s return. It applies to all projects that will make money in the near future.<\/p>\n\n\n\n<p>Comparing the DCF to the initial investment is common. The investment is profitable if the discounted cash flow (DCF) value exceeds the present value. Increases in DCF indicate better returns on investment.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Discounted_Cash_Flow_Formula\"><\/span><strong>Discounted Cash Flow Formula:<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<figure class=\"wp-block-image size-large is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Discounted-Cash-Flow-Formula-1024x576.jpg\" alt=\"\" class=\"wp-image-6932\" width=\"1195\" height=\"672\" srcset=\"https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Discounted-Cash-Flow-Formula-1024x576.jpg 1024w, https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Discounted-Cash-Flow-Formula-300x169.jpg 300w, https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Discounted-Cash-Flow-Formula-768x432.jpg 768w, https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Discounted-Cash-Flow-Formula-150x84.jpg 150w, https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Discounted-Cash-Flow-Formula.jpg 1280w\" sizes=\"(max-width: 1195px) 100vw, 1195px\" \/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_Does_Discounted_Cash_Flow_DCF_Work\"><\/span><strong>How Does Discounted Cash Flow (DCF) Work?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong>The goal of discounted cash flow analysis (DCF) is to figure out how much money will be coming in the future after taking into account how time acts as a multiplier.<\/strong><\/p>\n\n\n\n<p>To put it simply, the time value of money is the concept that money now is worth more than money tomorrow because it may be invested, and the invested money has the chance of making more money with time.&nbsp;<\/p>\n\n\n\n<p>Thus, a discounted cash flow analysis is applicable whenever one makes a current monetary outlay in anticipation of future financial gain. Simply put, by discounting future cash flows, known as DCF, the present value of an investment may be estimated. It can be used to get a rough idea of how much you need to invest to get the rate of return you want.<\/p>\n\n\n\n<p><strong>For instance, considering an interest rate of 6%, a rupee saved now will be worth 0.94 paise a year from now. The same holds true for delayed payments, wherein a rupee put off for a year is only worth 94 paise now since it can&#8217;t be put in a savings account at 6% and collected interest.<\/strong><\/p>\n\n\n\n<p>In a discounted cash flow analysis, the future cash flows are discounted to their present value. The present value of money is a tool for valuing future cash flows of an investment or project to see if they are more than the worth of the initial investment.<\/p>\n\n\n\n<p>The opportunity should be explored if the discounted cash flow (DCF) value is greater than the present value of the investment. If the calculated value is less than the cost, this might not be a good opportunity, or more research and analysis are needed.<\/p>\n\n\n\n<figure class=\"wp-block-embed aligncenter is-type-wp-embed is-provider-rakshith-pai wp-block-embed-rakshith-pai\"><blockquote class=\"wp-embedded-content\" data-secret=\"PA9wPJs4Hd\"><a href=\"https:\/\/rakshithpai.com\/time-value-of-money\/\">Understanding Time Value of Money (TVM):<\/a><\/blockquote><iframe class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;Understanding Time Value of Money (TVM):&#8221; &#8212; \" src=\"https:\/\/rakshithpai.com\/time-value-of-money\/embed\/#?secret=55KAinBsED#?secret=PA9wPJs4Hd\" data-secret=\"PA9wPJs4Hd\" width=\"200\" height=\"200\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_to_Calculate_DCF_Analysis\"><\/span><strong>How to Calculate DCF Analysis?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>To begin a DCF analysis, one must first make projections for both the investment&#8217;s ultimate value and its future cash flows. Your investment horizon might correspond to the time frame used in the estimate. <strong>If more money needed to be invested at some point in the future, the cash flow might be negative.<\/strong><\/p>\n\n\n\n<div class=\"wp-block-buttons is-horizontal is-content-justification-center is-layout-flex wp-container-core-buttons-is-layout-2 wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button is-style-outline\"><a class=\"wp-block-button__link has-text-color has-background\" href=\"https:\/\/zerodha.com\/open-account?c=PR4768\" style=\"border-radius:50px;background-color:#e4fa00;color:#0f0027\" rel=\"nofollow\"><strong>Open Zerodha Account Now!<\/strong><\/a><\/div>\n<\/div>\n\n\n\n<p>Next, you must decide on a rate to discount the cash flows to arrive at a fair present value. The discount rate is often the cost of capital, which can vary greatly from one project or investment to the next. The weighted-average cost of capital (WACC) method is useful when a project uses both loan and equity financing.<\/p>\n\n\n\n<p><strong>For a Better understanding, let\u2019s check an example;<\/strong><\/p>\n\n\n\n<p>We know that the present cash flow and future cash flow are not the same. This fact is the reason why we have the &#8220;Discounted Cash Flow&#8221;.<\/p>\n\n\n\n<p>For instance, let&#8217;s take a hypothetical example of &#8220;ITC Ltd.&#8221;\u00a0<\/p>\n\n\n\n<figure class=\"wp-block-image size-large is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Discounted-Cash-FLow-1024x576.jpg\" alt=\"\" class=\"wp-image-6933\" width=\"1195\" height=\"672\" srcset=\"https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Discounted-Cash-FLow-1024x576.jpg 1024w, https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Discounted-Cash-FLow-300x169.jpg 300w, https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Discounted-Cash-FLow-768x432.jpg 768w, https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Discounted-Cash-FLow-150x84.jpg 150w, https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Discounted-Cash-FLow.jpg 1280w\" sizes=\"(max-width: 1195px) 100vw, 1195px\" \/><\/figure>\n\n\n\n<p>In the above case, <a href=\"https:\/\/rakshithpai.com\/itc-worth-investing\/\">ITC<\/a> ltd total revenue over the 5 years period amounts to Rs.3,79,000 crores. At a 6% discounted rate, the revenue of ITC Ltd is at Rs.3,16,791.20 crores.&nbsp;<\/p>\n\n\n\n<p>Suppose the company spent Rs. 3,00,000 crore to arrive at a total revenue of Rs.3,79,000 crore. Then the net positive cash flow in nominal terms is Rs.3,79,000 crores but the same in real terms considering the discounted rate is Rs.3,16,791.20 crores.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Where_do_we_use_the_DCF_model\"><\/span><strong>Where do we use the DCF model?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong>A company&#8217;s worth or per-share value can be calculated using the DCF formula. The following are some of the areas where the DCF Model is used:<\/strong><\/p>\n\n\n\n<ol><li>Evaluating an Investment<\/li><li>Evaluate a particular project.<\/li><li>Bond and equity valuation<\/li><li>To Value Income-Generating Assets<\/li><li>Recognize the value of a cost-cutting measure,&nbsp;<\/li><li>Future Perspective on Cash Flow Statement<\/li><\/ol>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Advantages_of_Discounted_Cash_Flow\"><\/span><strong>Advantages of Discounted Cash Flow:<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ol><li>The discounted cash flow method (DCF) is a comprehensive valuation technique.&nbsp;<\/li><li>Using assumptions about a company, such as cash flow forecasts and discount rates, DCF uses hard statistics and measurements.&nbsp;<\/li><li>When these conditions hold, it&#8217;s possible to get a clear image of an asset&#8217;s worth based on the assumptions made.<\/li><li>When used properly, DCF enables unbiased, market-agnostic appraisals.&nbsp;<\/li><li>It is thought to be more objective than other valuation methods since it determines worth independently of volatile market sentiment.&nbsp;<\/li><li>Companies may be mispriced by the market, but these short-term changes don&#8217;t affect the DCF.<\/li><li>When evaluating an investment, DCF takes into account its possible future earnings.&nbsp;<\/li><li>Using the time value of money and other factors, DCF calculates how long it will take for an investment to generate a certain rate of return.<\/li><\/ol>\n\n\n\n<figure class=\"wp-block-embed aligncenter is-type-wp-embed is-provider-rakshith-pai wp-block-embed-rakshith-pai\"><blockquote class=\"wp-embedded-content\" data-secret=\"GPzOEiLMTX\"><a href=\"https:\/\/rakshithpai.com\/discounted-cash-flow-model-importance\/\">Discounted Cash Flow model &#8211; DCF &#038; its importance!<\/a><\/blockquote><iframe class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;Discounted Cash Flow model &#8211; DCF &#038; its importance!&#8221; &#8212; \" src=\"https:\/\/rakshithpai.com\/discounted-cash-flow-model-importance\/embed\/#?secret=0QlfNcIx1e#?secret=GPzOEiLMTX\" data-secret=\"GPzOEiLMTX\" width=\"200\" height=\"200\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Disadvantages_of_Discounted_Cash_Flow\"><\/span><strong>Disadvantages of Discounted Cash Flow:<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ol><li>A large amount of information is needed for a discounted cash flow model.&nbsp;<\/li><li>Accurate estimations are essential for DCF analysis.&nbsp;<\/li><li>It takes a lot of time and effort to gather all the necessary financial data for a DCF model.<\/li><li>When it comes to investing, the consequences of erroneous assumptions used in DCF models might be severe.<\/li><\/ol>\n\n\n\n<div class=\"wp-block-buttons is-horizontal is-content-justification-center is-layout-flex wp-container-core-buttons-is-layout-3 wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button is-style-outline\"><a class=\"wp-block-button__link has-text-color has-background\" href=\"https:\/\/zerodha.com\/open-account?c=PR4768\" style=\"border-radius:50px;background-color:#e4fa00;color:#0f0027\" rel=\"nofollow\"><strong>Open Zerodha Account Now!<\/strong><\/a><\/div>\n<\/div>\n\n\n\n<p><strong>For instance, if a financier overestimates future cash flows, he or she may put money into a venture that won&#8217;t provide a return and therefore reduce earnings. Assuming cash flows will be too low, on the other hand, might lead to foregone opportunities.\u00a0<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span><strong>Conclusion:<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong>A discounted cash flow analysis needs the investor&#8217;s estimates of future cash flows and the asset&#8217;s final value.<\/strong><\/p>\n\n\n\n<p>An acceptable discount rate for the DCF model must be determined by the investor, and this rate will change based on the nature of the project or investment being evaluated. The risk tolerance of the firm or investor, as well as the state of the capital markets, are two variables that might impact the final discount rate.<\/p>\n\n\n\n<p><strong>Instead of discounted cash flow (DCF), you should use other models if the investor can&#8217;t give reliable projections of future cash flows or if the project is very complicated.<\/strong><\/p>\n\n\n\n<p><strong>Disclaimer: <\/strong>All the information on this website is published in good faith and for general information purposes only.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Also_read\"><\/span><strong>Also read:<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><a href=\"https:\/\/rakshithpai.com\/remain-resilient-volatile-times\/\" target=\"_blank\" rel=\"noreferrer noopener\">How to Remain Resilient in Volatile Times?<\/a><\/td><\/tr><tr><td><a href=\"https:\/\/rakshithpai.com\/child-insurance-plan\/\" target=\"_blank\" rel=\"noreferrer noopener\">Child Insurance Plans &amp; How They Work?<\/a><\/td><\/tr><tr><td><a href=\"https:\/\/rakshithpai.com\/how-avoid-online-scam\/\" target=\"_blank\" rel=\"noreferrer noopener\">Avoid getting scammed! Here&#8217;s What You Need To Do:<\/a><\/td><\/tr><tr><td><a href=\"https:\/\/rakshithpai.com\/save-money-on-taxes\/\" target=\"_blank\" rel=\"noreferrer noopener\">Follow These Steps to Save Money on Taxes:<\/a><\/td><\/tr><tr><td><a href=\"https:\/\/rakshithpai.com\/life-insurance-importance\/\" target=\"_blank\" rel=\"noreferrer noopener\">Is Life Insurance for Everyone?<\/a><\/td><\/tr><\/tbody><\/table><\/figure>\n","protected":false},"excerpt":{"rendered":"<p>Introduction to Cash Flow: &#8220;Cash flow&#8221; is used to describe the net inflow and outflow of currency for a business. Money coming in and money going out are referred to as inflows and outflows, respectively. The capacity to produce positive cash flows, and more especially to optimize long-term free cash flow, is central to a [&hellip;]<\/p>\n<div class='heateor_sss_sharing_container heateor_sss_vertical_sharing heateor_sss_bottom_sharing' style='width:44px;right: -10px;top: 100px;background-color: Dark Blue' data-heateor-sss-href='https:\/\/rakshithpai.com\/wp-json\/wp\/v2\/posts\/6931'><div class=\"heateor_sss_sharing_ul\"><a aria-label=\"Facebook\" class=\"heateor_sss_facebook\" href=\"https:\/\/www.facebook.com\/sharer\/sharer.php?u=https%3A%2F%2Frakshithpai.com%2Fwp-json%2Fwp%2Fv2%2Fposts%2F6931\" title=\"Facebook\" rel=\"nofollow noopener\" target=\"_blank\" style=\"font-size:32px!important;box-shadow:none;display:inline-block;vertical-align:middle\"><span class=\"heateor_sss_svg\" style=\"background-color:#0765FE;width:40px;height:40px;margin:0;display:inline-block;opacity:1;float:left;font-size:32px;box-shadow:none;display:inline-block;font-size:16px;padding:0 4px;vertical-align:middle;background-repeat:repeat;overflow:hidden;padding:0;cursor:pointer;box-sizing:content-box\"><svg style=\"display:block;\" focusable=\"false\" aria-hidden=\"true\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"100%\" height=\"100%\" viewBox=\"0 0 32 32\"><path fill=\"#fff\" d=\"M28 16c0-6.627-5.373-12-12-12S4 9.373 4 16c0 5.628 3.875 10.35 9.101 11.647v-7.98h-2.474V16H13.1v-1.58c0-4.085 1.849-5.978 5.859-5.978.76 0 2.072.15 2.608.298v3.325c-.283-.03-.775-.045-1.386-.045-1.967 0-2.728.745-2.728 2.683V16h3.92l-.673 3.667h-3.247v8.245C23.395 27.195 28 22.135 28 16Z\"><\/path><\/svg><\/span><\/a><a aria-label=\"Twitter\" class=\"heateor_sss_button_twitter\" href=\"http:\/\/twitter.com\/intent\/tweet?text=%20-%20Save%20-%20Invest%20-%20Repeat&url=https%3A%2F%2Frakshithpai.com%2Fwp-json%2Fwp%2Fv2%2Fposts%2F6931\" title=\"Twitter\" rel=\"nofollow noopener\" target=\"_blank\" style=\"font-size:32px!important;box-shadow:none;display:inline-block;vertical-align:middle\"><span class=\"heateor_sss_svg heateor_sss_s__default heateor_sss_s_twitter\" style=\"background-color:#55acee;width:40px;height:40px;margin:0;display:inline-block;opacity:1;float:left;font-size:32px;box-shadow:none;display:inline-block;font-size:16px;padding:0 4px;vertical-align:middle;background-repeat:repeat;overflow:hidden;padding:0;cursor:pointer;box-sizing:content-box\"><svg style=\"display:block;\" focusable=\"false\" aria-hidden=\"true\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"100%\" height=\"100%\" viewBox=\"-4 -4 39 39\"><path d=\"M28 8.557a9.913 9.913 0 0 1-2.828.775 4.93 4.93 0 0 0 2.166-2.725 9.738 9.738 0 0 1-3.13 1.194 4.92 4.92 0 0 0-3.593-1.55 4.924 4.924 0 0 0-4.794 6.049c-4.09-.21-7.72-2.17-10.15-5.15a4.942 4.942 0 0 0-.665 2.477c0 1.71.87 3.214 2.19 4.1a4.968 4.968 0 0 1-2.23-.616v.06c0 2.39 1.7 4.38 3.952 4.83-.414.115-.85.174-1.297.174-.318 0-.626-.03-.928-.086a4.935 4.935 0 0 0 4.6 3.42 9.893 9.893 0 0 1-6.114 2.107c-.398 0-.79-.023-1.175-.068a13.953 13.953 0 0 0 7.55 2.213c9.056 0 14.01-7.507 14.01-14.013 0-.213-.005-.426-.015-.637.96-.695 1.795-1.56 2.455-2.55z\" fill=\"#fff\"><\/path><\/svg><\/span><\/a><a aria-label=\"Linkedin\" class=\"heateor_sss_button_linkedin\" href=\"https:\/\/www.linkedin.com\/sharing\/share-offsite\/?url=https%3A%2F%2Frakshithpai.com%2Fwp-json%2Fwp%2Fv2%2Fposts%2F6931\" title=\"Linkedin\" rel=\"nofollow noopener\" target=\"_blank\" style=\"font-size:32px!important;box-shadow:none;display:inline-block;vertical-align:middle\"><span class=\"heateor_sss_svg heateor_sss_s__default heateor_sss_s_linkedin\" style=\"background-color:#0077b5;width:40px;height:40px;margin:0;display:inline-block;opacity:1;float:left;font-size:32px;box-shadow:none;display:inline-block;font-size:16px;padding:0 4px;vertical-align:middle;background-repeat:repeat;overflow:hidden;padding:0;cursor:pointer;box-sizing:content-box\"><svg style=\"display:block;\" focusable=\"false\" aria-hidden=\"true\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"100%\" height=\"100%\" viewBox=\"0 0 32 32\"><path d=\"M6.227 12.61h4.19v13.48h-4.19V12.61zm2.095-6.7a2.43 2.43 0 0 1 0 4.86c-1.344 0-2.428-1.09-2.428-2.43s1.084-2.43 2.428-2.43m4.72 6.7h4.02v1.84h.058c.56-1.058 1.927-2.176 3.965-2.176 4.238 0 5.02 2.792 5.02 6.42v7.395h-4.183v-6.56c0-1.564-.03-3.574-2.178-3.574-2.18 0-2.514 1.7-2.514 3.46v6.668h-4.187V12.61z\" fill=\"#fff\"><\/path><\/svg><\/span><\/a><a aria-label=\"Whatsapp\" class=\"heateor_sss_whatsapp\" href=\"https:\/\/api.whatsapp.com\/send?text=%20-%20Save%20-%20Invest%20-%20Repeat https%3A%2F%2Frakshithpai.com%2Fwp-json%2Fwp%2Fv2%2Fposts%2F6931\" title=\"Whatsapp\" rel=\"nofollow noopener\" target=\"_blank\" style=\"font-size:32px!important;box-shadow:none;display:inline-block;vertical-align:middle\"><span class=\"heateor_sss_svg\" style=\"background-color:#55eb4c;width:40px;height:40px;margin:0;display:inline-block;opacity:1;float:left;font-size:32px;box-shadow:none;display:inline-block;font-size:16px;padding:0 4px;vertical-align:middle;background-repeat:repeat;overflow:hidden;padding:0;cursor:pointer;box-sizing:content-box\"><svg style=\"display:block;\" focusable=\"false\" aria-hidden=\"true\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"100%\" height=\"100%\" viewBox=\"-6 -5 40 40\"><path class=\"heateor_sss_svg_stroke heateor_sss_no_fill\" stroke=\"#fff\" stroke-width=\"2\" fill=\"none\" d=\"M 11.579798566743314 24.396926207859085 A 10 10 0 1 0 6.808479557110079 20.73576436351046\"><\/path><path d=\"M 7 19 l -1 6 l 6 -1\" class=\"heateor_sss_no_fill heateor_sss_svg_stroke\" stroke=\"#fff\" stroke-width=\"2\" fill=\"none\"><\/path><path d=\"M 10 10 q -1 8 8 11 c 5 -1 0 -6 -1 -3 q -4 -3 -5 -5 c 4 -2 -1 -5 -1 -4\" fill=\"#fff\"><\/path><\/svg><\/span><\/a><a aria-label=\"Copy Link\" class=\"heateor_sss_button_copy_link\" title=\"Copy Link\" rel=\"nofollow noopener\" href=\"https:\/\/rakshithpai.com\/wp-json\/wp\/v2\/posts\/6931\" onclick=\"event.preventDefault()\" style=\"font-size:32px!important;box-shadow:none;display:inline-block;vertical-align:middle\"><span class=\"heateor_sss_svg heateor_sss_s__default heateor_sss_s_copy_link\" style=\"background-color:#ffc112;width:40px;height:40px;margin:0;display:inline-block;opacity:1;float:left;font-size:32px;box-shadow:none;display:inline-block;font-size:16px;padding:0 4px;vertical-align:middle;background-repeat:repeat;overflow:hidden;padding:0;cursor:pointer;box-sizing:content-box\"><svg style=\"display:block;\" focusable=\"false\" aria-hidden=\"true\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"100%\" height=\"100%\" viewBox=\"-4 -4 40 40\"><path fill=\"#fff\" d=\"M24.412 21.177c0-.36-.126-.665-.377-.917l-2.804-2.804a1.235 1.235 0 0 0-.913-.378c-.377 0-.7.144-.97.43.026.028.11.11.255.25.144.14.24.236.29.29s.117.14.2.256c.087.117.146.232.177.344.03.112.046.236.046.37 0 .36-.126.666-.377.918a1.25 1.25 0 0 1-.918.377 1.4 1.4 0 0 1-.373-.047 1.062 1.062 0 0 1-.345-.175 2.268 2.268 0 0 1-.256-.2 6.815 6.815 0 0 1-.29-.29c-.14-.142-.223-.23-.25-.254-.297.28-.445.607-.445.984 0 .36.126.664.377.916l2.778 2.79c.243.243.548.364.917.364.36 0 .665-.118.917-.35l1.982-1.97c.252-.25.378-.55.378-.9zm-9.477-9.504c0-.36-.126-.665-.377-.917l-2.777-2.79a1.235 1.235 0 0 0-.913-.378c-.35 0-.656.12-.917.364L7.967 9.92c-.254.252-.38.553-.38.903 0 .36.126.665.38.917l2.802 2.804c.242.243.547.364.916.364.377 0 .7-.14.97-.418-.026-.027-.11-.11-.255-.25s-.24-.235-.29-.29a2.675 2.675 0 0 1-.2-.255 1.052 1.052 0 0 1-.176-.344 1.396 1.396 0 0 1-.047-.37c0-.36.126-.662.377-.914.252-.252.557-.377.917-.377.136 0 .26.015.37.046.114.03.23.09.346.175.117.085.202.153.256.2.054.05.15.148.29.29.14.146.222.23.25.258.294-.278.442-.606.442-.983zM27 21.177c0 1.078-.382 1.99-1.146 2.736l-1.982 1.968c-.745.75-1.658 1.12-2.736 1.12-1.087 0-2.004-.38-2.75-1.143l-2.777-2.79c-.75-.747-1.12-1.66-1.12-2.737 0-1.106.392-2.046 1.183-2.818l-1.186-1.185c-.774.79-1.708 1.186-2.805 1.186-1.078 0-1.995-.376-2.75-1.13l-2.803-2.81C5.377 12.82 5 11.903 5 10.826c0-1.08.382-1.993 1.146-2.738L8.128 6.12C8.873 5.372 9.785 5 10.864 5c1.087 0 2.004.382 2.75 1.146l2.777 2.79c.75.747 1.12 1.66 1.12 2.737 0 1.105-.392 2.045-1.183 2.817l1.186 1.186c.774-.79 1.708-1.186 2.805-1.186 1.078 0 1.995.377 2.75 1.132l2.804 2.804c.754.755 1.13 1.672 1.13 2.75z\"\/><\/svg><\/span><\/a><a class=\"heateor_sss_more\" title=\"More\" rel=\"nofollow noopener\" style=\"font-size: 32px!important;border:0;box-shadow:none;display:inline-block!important;font-size:16px;padding:0 4px;vertical-align: middle;display:inline;\" href=\"https:\/\/rakshithpai.com\/wp-json\/wp\/v2\/posts\/6931\" onclick=\"event.preventDefault()\"><span class=\"heateor_sss_svg\" style=\"background-color:#ee8e2d;width:40px;height:40px;margin:0;display:inline-block!important;opacity:1;float:left;font-size:32px!important;box-shadow:none;display:inline-block;font-size:16px;padding:0 4px;vertical-align:middle;display:inline;background-repeat:repeat;overflow:hidden;padding:0;cursor:pointer;box-sizing:content-box;\" onclick=\"heateorSssMoreSharingPopup(this, 'https:\/\/rakshithpai.com\/wp-json\/wp\/v2\/posts\/6931', '%20-%20Save%20-%20Invest%20-%20Repeat', '' )\"><svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" xmlns:xlink=\"http:\/\/www.w3.org\/1999\/xlink\" viewBox=\"-.3 0 32 32\" version=\"1.1\" width=\"100%\" height=\"100%\" style=\"display:block;\" xml:space=\"preserve\"><g><path fill=\"#fff\" d=\"M18 14V8h-4v6H8v4h6v6h4v-6h6v-4h-6z\" fill-rule=\"evenodd\"><\/path><\/g><\/svg><\/span><\/a><\/div><div class=\"heateorSssClear\"><\/div><\/div>","protected":false},"author":1,"featured_media":6935,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_uag_custom_page_level_css":"","site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"footnotes":""},"categories":[1],"tags":[532,538,535,534,537,536,531,533],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.5 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Discounted Cash Flow &amp; its Importance: -<\/title>\n<meta name=\"description\" content=\"&quot;Cash flow&quot; is used to describe the net inflow and outflow of currency for a business. Money coming in and money going out are referred to as inflows and outflows, respectively. The capacity to produce positive cash flows, and more especially to optimize long-term free cash flow, is central to a company&#039;s ability to create value for its shareholders (CFC). Free cash flow (FCF) is the cash flow remaining after a firm deducts the cost of capital expenditures from its regular operating cash flow (CapEx).\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/rakshithpai.com\/discounted-cash-flow\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Discounted Cash Flow &amp; its Importance: -\" \/>\n<meta property=\"og:description\" content=\"&quot;Cash flow&quot; is used to describe the net inflow and outflow of currency for a business. Money coming in and money going out are referred to as inflows and outflows, respectively. The capacity to produce positive cash flows, and more especially to optimize long-term free cash flow, is central to a company&#039;s ability to create value for its shareholders (CFC). Free cash flow (FCF) is the cash flow remaining after a firm deducts the cost of capital expenditures from its regular operating cash flow (CapEx).\" \/>\n<meta property=\"og:url\" content=\"https:\/\/rakshithpai.com\/discounted-cash-flow\/\" \/>\n<meta property=\"article:author\" content=\"https:\/\/www.facebook.com\/Iam.Mrpai\" \/>\n<meta property=\"article:published_time\" content=\"2022-11-01T13:07:43+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-11-01T13:14:04+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1280\" \/>\n\t<meta property=\"og:image:height\" content=\"720\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Rakshith Pai\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@Iam_MrPai\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Rakshith Pai\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"6 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/rakshithpai.com\/discounted-cash-flow\/\",\"url\":\"https:\/\/rakshithpai.com\/discounted-cash-flow\/\",\"name\":\"Discounted Cash Flow & its Importance: -\",\"isPartOf\":{\"@id\":\"https:\/\/rakshithpai.com\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/rakshithpai.com\/discounted-cash-flow\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/rakshithpai.com\/discounted-cash-flow\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow.jpg\",\"datePublished\":\"2022-11-01T13:07:43+00:00\",\"dateModified\":\"2022-11-01T13:14:04+00:00\",\"author\":{\"@id\":\"https:\/\/rakshithpai.com\/#\/schema\/person\/5a10929466befdcdb3013e5341aeb693\"},\"description\":\"\\\"Cash flow\\\" is used to describe the net inflow and outflow of currency for a business. Money coming in and money going out are referred to as inflows and outflows, respectively. The capacity to produce positive cash flows, and more especially to optimize long-term free cash flow, is central to a company's ability to create value for its shareholders (CFC). Free cash flow (FCF) is the cash flow remaining after a firm deducts the cost of capital expenditures from its regular operating cash flow (CapEx).\",\"breadcrumb\":{\"@id\":\"https:\/\/rakshithpai.com\/discounted-cash-flow\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/rakshithpai.com\/discounted-cash-flow\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/rakshithpai.com\/discounted-cash-flow\/#primaryimage\",\"url\":\"https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow.jpg\",\"contentUrl\":\"https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow.jpg\",\"width\":1280,\"height\":720,\"caption\":\"Importance of Discounted Cash Flow\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/rakshithpai.com\/discounted-cash-flow\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/rakshithpai.com\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Discounted Cash Flow &#038; its Importance:\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/rakshithpai.com\/#website\",\"url\":\"https:\/\/rakshithpai.com\/\",\"name\":\"\",\"description\":\"Save - Invest - Repeat\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/rakshithpai.com\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/rakshithpai.com\/#\/schema\/person\/5a10929466befdcdb3013e5341aeb693\",\"name\":\"Rakshith Pai\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/rakshithpai.com\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/34b7459182e8fb8b80ca20098eb1e8a9?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/34b7459182e8fb8b80ca20098eb1e8a9?s=96&d=mm&r=g\",\"caption\":\"Rakshith Pai\"},\"description\":\"An Investor, Entrepreneur by profession, and an Economist (Monetarist) by passion. Professional Investor in Equities and other assets. Here to spread the concept of \u201cSane Investing\u201d.\",\"sameAs\":[\"https:\/\/rakshithpai.com\",\"https:\/\/www.facebook.com\/Iam.Mrpai\",\"https:\/\/www.instagram.com\/iam_mrpai\",\"https:\/\/www.linkedin.com\/in\/iam-mrpai\",\"https:\/\/in.pinterest.com\/Iam_MrPai\",\"https:\/\/x.com\/Iam_MrPai\",\"https:\/\/www.youtube.com\/channel\/UC3vfc8G1sysZleCAKbytRFQ?view_as=subscriber\"],\"url\":\"https:\/\/rakshithpai.com\/author\/mrpai27\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Discounted Cash Flow & its Importance: -","description":"\"Cash flow\" is used to describe the net inflow and outflow of currency for a business. Money coming in and money going out are referred to as inflows and outflows, respectively. The capacity to produce positive cash flows, and more especially to optimize long-term free cash flow, is central to a company's ability to create value for its shareholders (CFC). Free cash flow (FCF) is the cash flow remaining after a firm deducts the cost of capital expenditures from its regular operating cash flow (CapEx).","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/rakshithpai.com\/discounted-cash-flow\/","og_locale":"en_US","og_type":"article","og_title":"Discounted Cash Flow & its Importance: -","og_description":"\"Cash flow\" is used to describe the net inflow and outflow of currency for a business. Money coming in and money going out are referred to as inflows and outflows, respectively. The capacity to produce positive cash flows, and more especially to optimize long-term free cash flow, is central to a company's ability to create value for its shareholders (CFC). Free cash flow (FCF) is the cash flow remaining after a firm deducts the cost of capital expenditures from its regular operating cash flow (CapEx).","og_url":"https:\/\/rakshithpai.com\/discounted-cash-flow\/","article_author":"https:\/\/www.facebook.com\/Iam.Mrpai","article_published_time":"2022-11-01T13:07:43+00:00","article_modified_time":"2022-11-01T13:14:04+00:00","og_image":[{"width":1280,"height":720,"url":"https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow.jpg","type":"image\/jpeg"}],"author":"Rakshith Pai","twitter_card":"summary_large_image","twitter_creator":"@Iam_MrPai","twitter_misc":{"Written by":"Rakshith Pai","Est. reading time":"6 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/rakshithpai.com\/discounted-cash-flow\/","url":"https:\/\/rakshithpai.com\/discounted-cash-flow\/","name":"Discounted Cash Flow & its Importance: -","isPartOf":{"@id":"https:\/\/rakshithpai.com\/#website"},"primaryImageOfPage":{"@id":"https:\/\/rakshithpai.com\/discounted-cash-flow\/#primaryimage"},"image":{"@id":"https:\/\/rakshithpai.com\/discounted-cash-flow\/#primaryimage"},"thumbnailUrl":"https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow.jpg","datePublished":"2022-11-01T13:07:43+00:00","dateModified":"2022-11-01T13:14:04+00:00","author":{"@id":"https:\/\/rakshithpai.com\/#\/schema\/person\/5a10929466befdcdb3013e5341aeb693"},"description":"\"Cash flow\" is used to describe the net inflow and outflow of currency for a business. Money coming in and money going out are referred to as inflows and outflows, respectively. The capacity to produce positive cash flows, and more especially to optimize long-term free cash flow, is central to a company's ability to create value for its shareholders (CFC). Free cash flow (FCF) is the cash flow remaining after a firm deducts the cost of capital expenditures from its regular operating cash flow (CapEx).","breadcrumb":{"@id":"https:\/\/rakshithpai.com\/discounted-cash-flow\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/rakshithpai.com\/discounted-cash-flow\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/rakshithpai.com\/discounted-cash-flow\/#primaryimage","url":"https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow.jpg","contentUrl":"https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow.jpg","width":1280,"height":720,"caption":"Importance of Discounted Cash Flow"},{"@type":"BreadcrumbList","@id":"https:\/\/rakshithpai.com\/discounted-cash-flow\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/rakshithpai.com\/"},{"@type":"ListItem","position":2,"name":"Discounted Cash Flow &#038; its Importance:"}]},{"@type":"WebSite","@id":"https:\/\/rakshithpai.com\/#website","url":"https:\/\/rakshithpai.com\/","name":"","description":"Save - Invest - Repeat","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/rakshithpai.com\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/rakshithpai.com\/#\/schema\/person\/5a10929466befdcdb3013e5341aeb693","name":"Rakshith Pai","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/rakshithpai.com\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/34b7459182e8fb8b80ca20098eb1e8a9?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/34b7459182e8fb8b80ca20098eb1e8a9?s=96&d=mm&r=g","caption":"Rakshith Pai"},"description":"An Investor, Entrepreneur by profession, and an Economist (Monetarist) by passion. Professional Investor in Equities and other assets. Here to spread the concept of \u201cSane Investing\u201d.","sameAs":["https:\/\/rakshithpai.com","https:\/\/www.facebook.com\/Iam.Mrpai","https:\/\/www.instagram.com\/iam_mrpai","https:\/\/www.linkedin.com\/in\/iam-mrpai","https:\/\/in.pinterest.com\/Iam_MrPai","https:\/\/x.com\/Iam_MrPai","https:\/\/www.youtube.com\/channel\/UC3vfc8G1sysZleCAKbytRFQ?view_as=subscriber"],"url":"https:\/\/rakshithpai.com\/author\/mrpai27\/"}]}},"uagb_featured_image_src":{"full":["https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow.jpg",1280,720,false],"thumbnail":["https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow-150x150.jpg",150,150,true],"medium":["https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow-300x169.jpg",300,169,true],"medium_large":["https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow-768x432.jpg",768,432,true],"large":["https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow-1024x576.jpg",1024,576,true],"1536x1536":["https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow.jpg",1280,720,false],"2048x2048":["https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow.jpg",1280,720,false],"web-stories-poster-portrait":["https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow-640x720.jpg",640,720,true],"web-stories-publisher-logo":["https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow-96x96.jpg",96,96,true],"web-stories-thumbnail":["https:\/\/rakshithpai.com\/wp-content\/uploads\/2022\/11\/Everything-to-Know-about-Discounted-Cash-Flow-150x84.jpg",150,84,true]},"uagb_author_info":{"display_name":"Rakshith Pai","author_link":"https:\/\/rakshithpai.com\/author\/mrpai27\/"},"uagb_comment_info":0,"uagb_excerpt":"Introduction to Cash Flow: &#8220;Cash flow&#8221; is used to describe the net inflow and outflow of currency for a business. Money coming in and money going out are referred to as inflows and outflows, respectively. The capacity to produce positive cash flows, and more especially to optimize long-term free cash flow, is central to a&hellip;","_links":{"self":[{"href":"https:\/\/rakshithpai.com\/wp-json\/wp\/v2\/posts\/6931"}],"collection":[{"href":"https:\/\/rakshithpai.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/rakshithpai.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/rakshithpai.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/rakshithpai.com\/wp-json\/wp\/v2\/comments?post=6931"}],"version-history":[{"count":4,"href":"https:\/\/rakshithpai.com\/wp-json\/wp\/v2\/posts\/6931\/revisions"}],"predecessor-version":[{"id":6939,"href":"https:\/\/rakshithpai.com\/wp-json\/wp\/v2\/posts\/6931\/revisions\/6939"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/rakshithpai.com\/wp-json\/wp\/v2\/media\/6935"}],"wp:attachment":[{"href":"https:\/\/rakshithpai.com\/wp-json\/wp\/v2\/media?parent=6931"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/rakshithpai.com\/wp-json\/wp\/v2\/categories?post=6931"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/rakshithpai.com\/wp-json\/wp\/v2\/tags?post=6931"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}