Terminal Value

Now that we’ve estimated the free cash flow generated over the five-year forecast period, we need to estimate the value of JPMorgan SmartRetirement Blend Income Fund Class R5’s cash flows after that period (if we don’t include this, we would have to assume that JPMorgan SmartRetirement Blend Income Fund Class R5 stopped operating at the end of the five-year forecast period). To do so, we’ll determine the company’s terminal value.