Work backward from a current share price to estimate the constant FCFF growth rate the market price implies. Calculations run only in your browser; your inputs are not sent to Stock Metric Lab.
Market-implied assumption
Implied annual FCFF growth
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An implied growth rate describes what must be true in this simplified model; it does not predict actual growth.
Implied forecast
| Year | Implied FCFF | Present value |
|---|
Implied-growth sensitivity
Each cell shows the annual FCFF growth rate required at that WACC and terminal-growth combination.
What reverse DCF tells you
A reverse DCF begins with the market capitalization implied by share price and diluted shares. After adjusting for cash and debt, it solves for the explicit-period FCFF growth rate that makes the model’s enterprise value equal the market-implied enterprise value.
Target enterprise value = Share price × diluted shares − cash + debt
The calculator searches for one constant annual FCFF growth rate between −50% and 100%. If the price cannot be matched within that range, it reports that no solution was found instead of extrapolating an extreme answer.
Use the result as an expectations test, then enter your own assumptions in the standard DCF Calculator. For definitions and limitations, read the DCF valuation guide, FCFF guide, enterprise value guide, and ROIC versus WACC guide.
Where to find the inputs
- Share price: Use a current market quote and record its date and time. For historical analysis, match the price date to information that was then available.
- Diluted shares: Check the EPS note and the latest outstanding-share disclosure. Adjust for material options, restricted stock, convertibles, issuances, or repurchases after the reporting period.
- FCFF: Build a normalized annual figure from the income statement, cash-flow statement, and notes in the latest 10-K or 10-Q. Keep the cash flow before debt payments because this model discounts it at WACC.
- Cash and debt: Reconcile balance-sheet amounts with the debt, lease, pension, and noncontrolling-interest notes. Apply the same enterprise-value definition used in your forward DCF.
Important limitations
- A constant growth rate is a simplified expectation, not a forecast of annual results.
- The inferred rate changes materially with WACC, terminal growth, normalized FCFF, cash, debt, and diluted shares.
- Negative or unsustainably low current FCFF requires a more detailed path-to-normal model.
- Use current primary-source filings and consistent units.
Disclaimer
This calculator is for educational and informational purposes only and does not constitute investment, financial, tax, legal, or accounting advice, a recommendation, or an offer to buy or sell any security. Implied growth is a mathematical output from user-supplied price and assumptions—not a forecast, consensus estimate, expected return, or fair value. Results may differ materially from actual outcomes. Stock Metric Lab is not affiliated with any issuer entered by a user. Verify source data independently and consult a qualified professional before making investment decisions.