Terminal Value

Calumet Specialty Products Partners... (CLMT)


+0.20 (+1.49%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 11.10
Free cash flow (t + 1) 88.64
Terminal Value 974.08
Present Value of Terminal Value 575.47

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