Terminal Value

Bank of Marin Bancorp (BMRC)


-0.40 (-1.28%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.41
Free cash flow (t + 1) 50.35
Terminal Value 930.67
Present Value of Terminal Value 650.99

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