Terminal Value

Duke Energy Corporation (DUK)

$95.33

+2.31 (+2.48%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 4.34
Free cash flow (t + 1) 987.17
Terminal Value 42,186.71
Present Value of Terminal Value 34,113.13



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