What problem does it solve? Standard discounted cash flow models assume the firm survives, that debt is a financing choice, that the owner is diversified, and that current earnings are meaningful. Banks, distressed firms, private businesses, cyclical companies, and young startups each break one of those assumptions, and applying a plain DCF to them produces wrong answers. This skill repairs the specific break with the correct model for each case. ## Core Features & Use Cases - Distress adjustment: Derives annual and cumulative failure probabilities from a traded bond price, credit rating, or sector survival data, then blends going-concern and distress-sale values, including partial equity wipeouts. - Financial service firms: Values bank and insurer equity directly via excess return on equity or FCFE against regulatory capital, reporting both residual-income and cash-flow routes so inconsistencies surface. - Private company adjustments: Computes total beta for undiversified owners and three illiquidity discounts (flat, Silber restricted-stock, bid-ask spread regression). - Cyclical and commodity normalization: Regresses revenues on commodity prices or normalizes mid-cycle earnings three ways, emitting DCF-ready drivers. - Young companies and IPOs: Builds a complete dcf-valuation-engine payload from revenue and margin targets with survival odds, and walks a private value to an IPO offer price step by step. - Use Case: Valuing a bank in crisis — feed book equity, risk-adjusted assets, the capital ratio path, and a return-on-equity path into the excess-return subcommand to get equity value per share with a wipeout-probability overlay. ## Quick Start Ask the agent to value a distressed company by running the distress subcommand with its bond price, coupon, and maturity to get the implied failure probability and blended equity value.
