Terminal Value
Alimentation Couche-Tard Inc. (ATD-B.TO)
$49.67
+0.78 (+1.60%)
| Growth in perpetuity method: | |
|---|---|
| Long-term growth rate | |
| WACC (%) | 7.54 |
| Free cash flow (t + 1) | 2,609.47 |
| Terminal Value | 47,102.40 |
| Present Value of Terminal Value | 32,748.61 |
Now that we’ve estimated the free cash flow generated over the five-year forecast period, we need to estimate the value of Alimentation Couche-Tard Inc.’s cash flows after that period (if we don’t include this, we would have to assume that Alimentation Couche-Tard Inc. stopped operating at the end of the five-year forecast period). To do so, we’ll determine the company’s terminal value.