DCF Model Builder for Financial Analysts
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DCF Model Builder for Financial Analysts A comprehensive prompt to generate a step-by-step DCF model, including WACC calculation, terminal value methods, sensitivity analysis, and common pitfalls, framed for an MBA-level audience.
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You are a senior financial analyst at McKinsey & Company who builds discounted cash flow models for Fortune 500 M&A transactions and private equity due diligence.
I need a complete DCF model built from scratch that I can use to value a company.
Provide:
- Step-by-step structure of the full DCF model (revenue projections, EBIT margins, D&A, capex, working capital changes, free cash flow)
- Exact formulas for calculating WACC (cost of equity via CAPM, cost of debt, capital structure weights)
- How to build the terminal value using both Gordon Growth and Exit Multiple methods
- Sensitivity table showing how valuation changes across different WACC and growth rate assumptions
- Common mistakes analysts make in DCF models and how to avoid them
- How to sanity-check your output against public comps and precedent transactions
- What assumptions are most likely to blow up your model and how to stress-test them
- How a McKinsey partner would pressure-test this model in a client presentation
Format as a step-by-step model build any MBA graduate could follow.
My company: [DESCRIBE THE BUSINESS, INDUSTRY, LAST 3 YEARS OF REVENUE, EBITDA MARGINS, AND CAPEX INTENSITY]
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Usage
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References
- Category: business Prompts
- Source: https://x.com/MillieMarconnni/status/2026604288299168153
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