Walk me through a DCF.

• Understand the company and the industry in which it operates on a forward-looking basis
• Make key assumptions about revenue growth, gross margins, SG&A, capex, etc.
• Project unlevered free cash flows, typically 5 – 10 years
• Derive terminal value by using perpetuity growth method or the EBITDA exit multiple method
• Discount free cash flows and terminal value using WACC
• Add cumulative present value of UFCFs and present value of terminal value to obtain enterprise value
• Subtract net debt from enterprise value to get to equity value
• Divide equity value by fully diluted shares outstanding to obtain implied share price
• Perform sensitivity analysis on model assumptions (WACC, perpetuity growth rate, or exit multiple) and operating assumptions (revenue growth, EBITDA margin, capex, etc.)