The Limitations of the DCF Approach - Online

This course teaches the fundamentals of valuing public and private companies through a case study approach. This module focusses on the limitations of the DCF Approach to Business Valuation

This course replicates the content from lesson 6 from Business Valuation - Online

This is an asynchronous eLearning course that can be accessed 24/7 from any internet enabled computer. Subscription period for this course is 90 days.


Individuals in credit, investment banking, corporate finance, and sales and trading.
Students will be able to:
  • Identify the impact of changes in value drivers, WACC and terminal value assumptions on a base case valuation through sensitivity analysis.
  • Describe the use of scenario analysis to improve a base case valuation.
  • Recognize limitations of the DCF methodology.
Financial Statement Analysis and Corporate Finance, or equivalent level of knowledge.
The Limitations of the DCF Approach
  • Sensitivity of DCF valuations to the assumptions made
  • Using sensitivity analysis to improve the base case valuation
  • Scenario analysis and Monte Carlo simulations