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M&A Blog #15 – valuation (tools and data preparation)

Francine Way

Target’s primary country (where the company is likely to borrow) risk-free rate: Can be obtained from government sources such as Treasury.gov’s 10-years Treasury Bond Yield. Information listed in the DCF analysis: See the items listed under DCF above. Different sources will cite different betas for the same company.

Valuation 130
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Determining Discount Rate for Companies with Negative Initial Cash Flows and Future Growth

Wizenius

The WACC considers the cost of debt and equity financing and reflects the risk associated with the company's capital structure. Adjustments for Negative Cash Flows: Incorporate adjustments in the DCF analysis to account for the negative cash flows in the initial years.