Terminal Value

Broadridge Financial Solutions, Inc... (BR)


+4.59 (+3.18%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 6.79
Free cash flow (t + 1) 1,066.90
Terminal Value 22,273.52
Present Value of Terminal Value 16,037.47

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