Terminal Value

Creative Media & Community Trust Co... (CMCTP)


+0.49 (+1.86%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 4.59
Free cash flow (t + 1) 27.43
Terminal Value 1,059.12
Present Value of Terminal Value 846.25

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