IF you believe that picking the "right" DCFR will get a "realistic valuation", I've a bridge to sell you. A myriad of other assumptions, known and unknown will be far more important.
Did I say the other variables / assumptions (known or unknown) weren't vitally important? Obviously, the variables used to drive revenues, expenses, etc., are vital to the analysis. However, using a discount rate of 5% vs. 10% makes a world of a difference to the ending valuation.
Buffett counsels use of the Long Term Government Bond, currently a bit under 5%.
And then adds an additional percentage (5+%) to arrive at the weighted cost of capital (discount factor).
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