Net present value of future cash flows

Analysts and finance teams can discount projected cash flows when they need a present-day figure for assessing a project or investment.

Bring a stream of future cash flows back to today at the chosen rate, producing a net present value that is ready for comparison.

How to use

Enter the discount rate as a percentage on the first line of the input area.
Add the cash flows one per line, starting with the initial flow, which is usually negative for an investment.
Run the calculation to discount each cash flow to its corresponding period.
Read the net present value and compare it with zero or with another project.
Change the rate or the cash flows to test how sensitive the result is before deciding.

Example

An analyst tests a project with a rate of 10 and cash flows starting at -1000, followed by 300, 400 and 500. Running the calculation shows the net present value, helping them judge whether the project adds value under that assumption.

Input

Limits and formats

The calculation assumes regular periods and a constant rate; irregular timing or changing rates are not modelled here.
Follow the sign convention: the first cash flow is often negative because it represents the initial outlay.
Taxes, inflation and risk are not included unless you have already built them into the cash flow values.
Check every input, because a wrong rate or sign can change the net present value considerably.

Where processing happens

The computation runs completely in your browser. The rate and cash flows you enter stay local and are not sent to another service. No history is kept, so you can try several scenarios without creating an account.

Frequently asked questions

How is NPV related to the discount rate?

The discount rate represents the return you require or the cost of capital. NPV is the result after bringing future cash flows back to today at that rate. A positive figure suggests the project exceeds the required return.

Why is the first cash flow often negative?

The first flow usually represents the initial investment outlay. Putting it as a negative value lets it offset later income. If your project starts with a receipt, simply use the sign that fits your convention.

Can I compare projects with different durations?

NPV gives a value-based comparison, but it is not enough when durations or initial amounts differ widely. Use additional indicators alongside it and keep the same assumptions so the comparison remains fair.