Terminal Value

Alimentation Couche-Tard Inc. (ATD-B.TO)


+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.