> ## Documentation Index
> Fetch the complete documentation index at: https://financecontext.com/llms.txt
> Use this file to discover all available pages before exploring further.

# DCF Command

> Build a DCF valuation model -- learn how discounted cash flow analysis works and why it is the gold standard for intrinsic valuation.

# `/dcf` -- DCF Valuation

A DCF (Discounted Cash Flow) valuation answers the most fundamental question in finance: **"What is this company worth based on the cash it will generate in the future?"** Unlike methods that rely on what the market is currently paying for similar companies, a DCF calculates a company's intrinsic value by projecting its future cash flows and discounting them back to today's dollars.

This command builds an institutional-quality DCF model that first runs a comparable company analysis to establish market-based benchmarks, then constructs a full DCF that uses those comps to inform key assumptions -- giving you both an intrinsic value estimate and a market-based sanity check.

For a deep dive into DCF concepts (time value of money, WACC, terminal value, sensitivity analysis), see the [DCF Model Skill](/en/financial-analysis/skills/dcf-model) page.

## Command Syntax

```
/dcf [company name or ticker]
```

**Examples:**

```bash theme={null}
/dcf Apple
/dcf AAPL
/dcf "Microsoft Corporation"
```

If no argument is provided, Claude will ask: *"What company would you like to value?"*

## What It Produces

1. **Comps analysis spreadsheet** (.xlsx) -- Trading multiples for 4-6 comparable companies
2. **DCF model** (.xlsx) -- Bear/Base/Bull scenarios, WACC calculation, sensitivity tables, and valuation summary
3. **Written summary** -- Key drivers, how comps informed the analysis, and key risks

## Workflow

<Steps>
  <Step title="Gather Company Information">
    Provide a company name or ticker. Claude uses this to identify the subject company and begin data retrieval from available MCP sources (S\&P Global, FactSet, Daloopa preferred).
  </Step>

  <Step title="Run Comparable Company Analysis">
    Claude loads the `comps-analysis` skill to build trading comps. This step matters because comps provide the market's view of what similar companies are worth -- a critical sanity check for the DCF.

    * Identify 4-6 comparable public companies
    * Pull operating metrics (Revenue, EBITDA, margins, growth)
    * Pull valuation multiples (EV/Revenue, EV/EBITDA, P/E)
    * Calculate statistical summary (median, 25th/75th percentiles)
  </Step>

  <Step title="Build DCF Model">
    Claude loads the `dcf-model` skill to construct the valuation:

    * Gather historical financials and market data
    * Build revenue projections (Bear/Base/Bull cases)
    * Model operating expenses and free cash flow
    * Calculate WACC using CAPM
    * Discount cash flows and calculate terminal value
    * Bridge to equity value and implied share price
  </Step>

  <Step title="Cross-Check Valuation">
    After the DCF is complete, Claude validates the outputs against the comps -- because a DCF that implies a company trades at 30x EBITDA when its peers trade at 12x warrants scrutiny:

    * Implied EV/EBITDA vs. peer median
    * Implied P/E vs. peer median
    * Terminal value as % of EV (target: 50-70%)
    * Implied growth embedded in valuation vs. peer growth rates
  </Step>

  <Step title="Deliver Output">
    Claude delivers the comps spreadsheet, DCF model, and written summary.
  </Step>
</Steps>

## How Comps Inform the DCF

| Comps Output              | DCF Input                         | Why It Matters                                                                        |
| ------------------------- | --------------------------------- | ------------------------------------------------------------------------------------- |
| Peer median EV/EBITDA     | Terminal exit multiple range      | Sets the market-based anchor for what the company might trade at in the terminal year |
| Peer 25th-75th EV/EBITDA  | Sensitivity analysis range        | Defines the realistic range for sensitivity testing                                   |
| Peer median growth rate   | Benchmark for revenue assumptions | Keeps your growth projections grounded in what peers are actually achieving           |
| Peer median EBITDA margin | Target margin in terminal year    | Prevents unrealistic margin assumptions in the out-years                              |
| Peer median P/E           | Cross-check implied P/E from DCF  | Validates that the DCF output is reasonable relative to the market                    |

## How to Customize for Your Firm

Edit the DCF Model skill file to add your firm's specific conventions:

```bash theme={null}
# Install the plugin
claude plugin install financial-analysis@financial-services-plugins
```

Then edit `skills/dcf-model/SKILL.md` to add your preferences. For example, if your firm uses a different WACC methodology:

```markdown theme={null}
## Firm-Specific DCF Conventions
- Use 2-year weekly beta, not 5-year monthly
- Apply Duff & Phelps size premium
- Terminal growth rate capped at 3.0%
```

## Related

* [DCF Model Skill](/en/financial-analysis/skills/dcf-model) -- Full Finance 101 explanation of DCF concepts, workflow details, and sensitivity table construction
* [Comps Analysis Skill](/en/financial-analysis/skills/comps-analysis) -- Peer selection methodology and statistical benchmarking
* [`/comps` Command](/en/financial-analysis/commands/comps) -- Run a standalone comparable company analysis