DEFINITION of 'Discounted AfterTax Cash Flow'
An approach to valuing an investment that looks at the amount of money it generates and takes into account the cost of capital and the investor's marginal tax rate. Discounted aftertax cash flow is similar to simple discounted cash flow (DCF), but tax implications are also taken into consideration. Because there are many different methods for valuing an investment, and each method has its shortcomings, investors should not rely solely on discounted after tax cash flow to make a decision.
BREAKING DOWN 'Discounted AfterTax Cash Flow'
For example, discounted aftertax cash flow can be used in real estate valuation to determine whether a particular property is likely to be a good investment. Investors must consider depreciation, the tax bracket of the entity that will own the property and any interest payments when using this valuation method. To examine the property's value from multiple perspectives., you can also use other methods of real estate valuation such as the cost approach, sale comparison approach and income approach.

Discount Rate
The interest rate charged to commercial banks and other depository ... 
Discounted Cash Flow (DCF)
Discounted cash flow (DCF) is a valuation method used to estimate ... 
Present Value  PV
The current worth of a future sum of money or stream of cash ... 
AfterTax Income
The amount of money that an individual or company has left over ... 
AfterTax Return
The return on an investment including all income received and ... 
Direct Method
A method of creating a statement of cash flows during a given ...

Professionals
Discounted Cash Flow Valuation
Discounted cash flow (DCF) is a valuation method used to estimate the attractiveness of an investment opportunity. 
Fundamental Analysis
DCF Analysis: Introduction
By Ben McClure Contact Ben It can be hard to understand how stock analysts come up with "fair value" for companies, or why their target price estimates vary so wildly. The answer often lies ... 
Professionals
Introduction To Discounted Cash Flow Valuation
We look at discounted cash flow and alternative methodologies. 
Investing
Should You Use DCF for Valuation?
We explain the two primary valuation techniquesâ€”DCF and Comparablesâ€”used to predict future stock prices. 
Professionals
Real Estate Calculations
CFA Level 1  Real Estate Calculations. Learn the methods behind calculating the value of real estate investments. Provides sample calculations for a property income statement. 
Markets
Fundamental Analysis: A Brief Introduction To Valuation
By Ben McClureWhile the concept behind discounted cash flow analysis is simple, its practical application can be a different matter. The premise of the discounted cash flow method is that the ... 
Professionals
Common Stock Valuation
No one valuation method is perfect for every situation, but by knowing the characteristics of the company, you can select the valuation method that best suits the situation 
Active Trading
Evaluate Stock Price With ReverseEngineering DCF
This is a more accurate method to use when trying to find a target price for a stock. 
Options & Futures
StockPicking Strategies: Fundamental Analysis
Ever hear someone say that a company has "strong fundamentals"? The phrase is so overused that it's become somewhat of a cliché. Any analyst can refer to a company's fundamentals without ... 
Investing
Discounted Cash Flow (DCF)
Discover how investors can use this valuation method to determine the intrinsic value of a stock.

How do I calculate free, discounted and operational cash flow in Excel?
Take a quick look at how you can calculate a company's operating cash flow, free cash flow and discounted cash flows using ... Read Answer >> 
How do you use DCF for real estate valuation?
Learn how discounted cash flow analysis is used for real estate valuation and the various factors that go into calculating ... Read Answer >> 
Why would you take DCF into account rather than simply projecting future revenues?
Learn what discounted cash flow analysis is and why it is considered a better equity valuation tool than simply projecting ... Read Answer >> 
When and why should the terminal value be discounted?
Find out why investors use the terminal value, why the terminal value is discounted to the present day, and how it's related ... Read Answer >> 
How do I use discounted cash flow (DCF) to value stock?
Understand the meaning and significance of discounted cash flow, and learn how market analysts commonly use this stock evaluation ... Read Answer >> 
Are taxes calculated in operating cash flow?
Learn how taxes are involved with the calculations for operating cash flow, and find out about the importance of operational ... Read Answer >>