Terminal Value

BSR Real Estate Investment Trust (HOM-UN.TO)


-0.06 (-0.35%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 5.41
Free cash flow (t + 1) 759.70
Terminal Value 22,278.55
Present Value of Terminal Value 17,118.98

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