Terminal Value

ADT Inc. (ADT)

$8.2511

-0.01 (-0.11%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 2.84
Free cash flow (t + 1) 1,882.70
Terminal Value 224,131.04
Present Value of Terminal Value 194,846.07



Now that we’ve estimated the free cash flow generated over the five-year forecast period, we need to estimate the value of ADT Inc.’s cash flows after that period (if we don’t include this, we would have to assume that ADT Inc. stopped operating at the end of the five-year forecast period). To do so, we’ll determine the company’s terminal value.