Terminal Value

Playa Hotels & Resorts N.V. (PLYA)


-0.10 (-1.71%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 8.09
Free cash flow (t + 1) -53.99
Terminal Value -886.47
Present Value of Terminal Value -600.81

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