DCF Sensitivity Analysis

How sensitive is this enterprise DCF?

The question is how the same operating forecast produces different enterprise values when discount rate and terminal assumptions change together. This exercise uses the two grids in the DCF Valuation Model, rather than changing arbitrary financial-model inputs.

Keep the forecast and timing fixed

The synthetic 2026–2028 forecast produces annual unlevered FCFF of 445, 467.50 and 510 in EUR thousands, using a 25% normalized EBIT tax rate. Terminal-year EBITDA is 960. The FCFF Calculation provides the complete input and cash-flow bridge. Discount date is January 1, 2026, year-end convention, first-year proration on; all three years are full periods.

Base WACC is a 10% override. Perpetual growth is 2%; the alternative exit multiple is 8× EBITDA. Terminal anchor and terminal date are after 2028. Terminal normalization is off, the FCFF override is blank and other operating cash-flow additions are zero. Grid steps are one percentage point for WACC and growth, one multiple turn, and one step on each side. These are synthetic assumptions, not market estimates.

WACC sensitivity × terminal growth sensitivity

The central enterprise value is 6,059.50. It comprises explicit FCFF present value 1,174.08 plus terminal present value 4,885.42. Next-period FCFF is 510 × 1.02 = 520.20; terminal value is 520.20 / (10% − 2%) = 6,502.50, discounted for three years.

Across WACC 9–11% and growth 1–3%, enterprise value ranges from 4,919.61 to 7,956.02. Higher WACC discounts both explicit and terminal cash flows more heavily and widens the denominator. Higher growth increases next-period FCFF and narrows the WACC-minus-growth denominator. This grid changes the terminal extension, not the entered 2026–2028 forecast.

WACC × exit multiple: a different terminal assumption

The central exit-method enterprise value is 6,944.18. Terminal value is 960 × 8 = 7,680.00. With WACC 9–11% and exit multiples 7–9×, the range is 6,066.85 to 7,867.22. Increasing the multiple raises terminal value; increasing WACC lowers its present value and the explicit-flow present values.

Both grids are supported. Choosing the terminal method determines the selected DCF output; it does not make the alternative assumptions economically equivalent. The Terminal Value page owns method construction. Use Football Field Valuation when comparing these conditional ranges with other valuation methods.

Reject invalid combinations and scrutinize near-boundary values

For a separate stress test, change base growth to 9% and keep one-point steps: columns become 8%, 9% and 10%. The implementation marks perpetual-growth cells invalid when WACC is less than or equal to growth. These cells are excluded from the calculated range; an invalid cell is not zero enterprise value.

A valid 10% WACC / 9% growth cell still has only a one-point spread. Its large valuation is a warning about the assumption relationship, not evidence of an attractive company. The grid validates the mathematical boundary but does not judge long-term economic plausibility or assign probabilities. The table below is explicitly a boundary exercise.

Reproduce both native grids

1. Download the synthetic DCF model file. Open the DCF model, then explicitly select Manage models → Import and choose the file. It contains the 2026–2028 calendar-year forecast in EUR thousands. The primary CTA opens the Value workspace without importing any example. A blank model may first show Activate; this file already has DCF active. In Model, switch to Advanced before editing, then return to Value.

2. Open DCF. In Periods & cash flow settings, use discount date 2026-01-01, first cash flow 2026, explicit forecast through 2028, terminal value after 2028, Year-end and Prorate remaining first year on. Keep the reported basis and normalized EBIT tax. In WACC choose Override and enter 10%.

3. In Terminal value use anchor 2028. Select Perpetuity growth and set growth 2%; switch to Exit multiple, enter 8 and choose EBITDA, then return to Perpetuity growth. Keep normalization off and FCFF override blank. In Sensitivity set WACC step 1, growth step 1, multiple step 1 and steps each side 1. Read both 3×3 tables; switch terminal method between perpetual growth and exit multiple to check each base output. For the boundary exercise change only growth to 9%, then restore 2%.

Use the range for the question it answers

The range is the minimum and maximum of valid grid cells, not a confidence interval or probability-weighted forecast. WACC owns the cost-of-capital inputs; DCF Mid-Year Convention and Stub Periods owns discount timing. This page does not offer arbitrary input/output sensitivity, tornado charts or automated driver ranking. Displayed values are rounded from the production DCF engine.