Discounted Cash Flow (DCF) is a financial valuation method used to estimate the value of an investment based on its expected future cash flows. It involves projecting the cash flows that an investment will generate over time and then discounting them back to their present value using a specific rate, often reflecting the risk of the investment. The DCF method is widely used in finance for valuing companies, projects, and investments. By considering the time value of money, it helps investors make informed decisions by comparing the present value of expected cash flows to the initial investment cost, ensuring a more accurate assessment of potential profitability.