Terminal Value
Cooper-Standard Holdings Inc. (CPS)
$10.58
+0.87 (+8.96%)
| Growth in perpetuity method: | |
|---|---|
| Long-term growth rate | |
| WACC (%) | 7.63 |
| Free cash flow (t + 1) | 3.29 |
| Terminal Value | 58.42 |
| Present Value of Terminal Value | 40.45 |
Now that we’ve estimated the free cash flow generated over the five-year forecast period, we need to estimate the value of Cooper-Standard Holdings Inc.’s cash flows after that period (if we don’t include this, we would have to assume that Cooper-Standard Holdings Inc. stopped operating at the end of the five-year forecast period). To do so, we’ll determine the company’s terminal value.