Discounted Cash Flow

Investment Banking Slide Examples of Discounted Cash Flow

Tl;dr: Part of a collection of real examples of M&A investment banking slides. This blog covers Discounted Cash Flow. See the PowerPoint presentations investment bankers are paid millions for. No matter your job, or your aspirations, you can learn from these slides.

This is part of a collection of 67 free M&A presentations from the top 20 banks (based on ranking, and also the quality of presentation for you to learn from).

Collection of M&A slide examples

The main page for all the M&A resources is here.

I have broken out 827 examples of slides across 32 sections. You can click through to the section you want to learn about next here:

Company Overview
Corporate Structure
Management Projections
Research Analyst
Comparison Financial Projections
Analysis At Various Prices
Share Price Analysis
Volume Weighted Average Price
Regression Analysis
Discounted Cash Flow
Weighted Average Cost Of Capital
Comparable Companies
Comparable Transactions
Dividend Discount Model
Leveraged Buy Out
Premiums Paid
Sum Of The Parts
Football Field
Executive Summary
Offer Summary
Offer Comparison
Accretion Dilution 
Exchange Ratio And Contribution Analysis
Shareholder Analysis
Ability To Pay
Strategic Options
Transaction Case Study
Next Steps
Full valuation
Sales Pitches

Is this blog for you?

Why the heck should you care? Investment banks (historically) attracted the best and the brightest.

  • Slide structure/design: Learn how complicated concepts are structured and designed in PowerPoint
  • Analysis approach: See exactly how complex financial methods are presented
  • Strategy and communication: M&A deals are not (normally, other than many Duff and Phelps decks) cookie cutter. There’s a host of topics that need to be dealt with
  • Morbid interest: I used to do this for a living, but it’s still interesting to see how PPT are made… but then maybe it’s just me and so FML 😉

Who this will help:

  • You want to work in banking: There’s a lot of applicants. Knowing the job helps you answer questions
  • You work in banking: Even if you’re an MD, you need to know how the best are structuring their thoughts/analysis
  • You write presentations: You can’t buy learnings like this. You can learn from the slides
  • You have a curious mind: Good for you

About Discounted Cash Flow

You pretty much always refer to a Discounted Cash Flow as a DCF. This is one od the most fundamental analysis that you will learn. In fact, you’re expected to know how to do one to even have a chance of being hired when interviewing. So you will need to know how to do this theoretically, you’ll learn how to do it pragmatically on the job.

All it does is say we are going to forecast the cash a company makes (assuming it is profitable) for either 5 or 10 years. Cash in the future is worth less as you could invest the money somewhere else and be guaranteed an interest payment, so we’re going to make the cash in the future progressively smaller. At the end of the forecast period, we are set a terminal value which is heavily discounted by then but will add maybe 30% to the forecast period valuation.

Doing the actual DCF is pretty simple. In fact, you can use a template. What takes are feck tonne of time is building a huge-ass model to forecast the cash flow. You can spend weeks on this crap.

JP Morgan explains a DCF in more detail than I’m willing to, so I’m just going to let them actually teach you about DCF rather than me giving a couple of comments.

Why these slides are made

You have to do a DCF in pretty much any transaction. In fact you’ll do mini DCF valuations for sales pitches. Buckle up and learn this DCF stuff.

Comments on making these slides

There’s a lot to learn. It’s going to be a big part of your life 😉

Examples of Discounted Cash Flow

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