Standard procedures for evaluating future cash flows are to find an appropriate discount rate consistent with the cash flow's risk and then to derive a present value. While discounted cash flows seem appropriate for many instances, finding appropriate discount rates is often difficult, or discount rates may not exist when the risk is actually a function of a decision that requires the cash-flow valuation. We consider two approaches that have been suggested to alleviate this problem: the capital asset pricing model (CAPM) and the risk-neutral pricing arguments from option theory. We discuss the assumptions inherent in these models and show the results on the well-known news vendor model. Our option pricing results correspond to Singhal's [17] results using CAPM and a different valuation procedure for the option pricing model. We, however, derive a simpler expression that clearly illustrates differences from the standard form ignoring risk.