Future Revenue

The projected future revenue. There are four main types of forecasting methods that financial analysts use to predict future revenues, expenses, and capital costs for a business. The top four methods to calculate future revenue: (1) straight-line, (2) moving average, (3) simple linear regression, and (4) multiple linear regression. [1]

The straight-line method is one of the simplest and easy-to-follow forecasting methods. A financial analyst uses historical figures and trends to predict future revenue growth. It assumes a constant growth rate. This is the most simple model

Moving averages are a smoothing technique that looks at the underlying pattern of a set of data to establish an estimate of future values. The most common types are the 3-month and 5-month moving averages."

NOTE: More relevant to mature businesses than early-stage companies.

[1] Corporate Finance Institute. Retrieved May 21, 2021, from

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