Sample interview questions: Can you explain your experience with financial valuation techniques, such as discounted cash flow (DCF) analysis?
Sample answer:
Discounted Cash Flow (DCF) Analysis
My expertise in financial valuation techniques, particularly DCF analysis, has been honed through my extensive experience in various industries. DCF analysis involves projecting future cash flows and discounting them to their present value to determine the intrinsic value of an asset or business.
Key Elements of DCF Analysis:
- Revenue and expense forecasting
- Terminal value estimation
- Discount rate selection
- Sensitivity analysis
Applications of DCF:
- Business valuations
- Capital budgeting
- Mergers and acquisitions
- Investment analysis
Advantages
- Considers future cash flows, providing a more comprehensive valuation.
- Provides a qu… Read full answer