How Top M&A Practitioners Are Using DCF Techniques

Business Valuation Update
Business Valuation Australia
January 15, 2016

Summary

Major investment banks routinely use discounted cash flow techniques to determine company value in mergers and acquisitions. However, the actual application of the methods is “far from routine,” say the authors of a study published in the Journal of Applied Finance. The study’s results “serve as yet another reminder that analytic techniques such as DCF do not make decisions but only inform them.”