Terminal Value

iHeartMedia, Inc. (IHRT)


+0.37 (+4.65%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 5.94
Free cash flow (t + 1) 1,265.53
Terminal Value 32,119.97
Present Value of Terminal Value 24,069.96

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