Terminal Value

DXP Enterprises, Inc. (DXPE)


-0.02 (-0.08%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 9.53
Free cash flow (t + 1) 45.11
Terminal Value 599.12
Present Value of Terminal Value 380.05

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