Terminal Value

Primo Water Corporation (PRMW)

$14.15

+0.30 (+2.17%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 3.98
Free cash flow (t + 1) 328.24
Terminal Value 16,577.66
Present Value of Terminal Value 13,638.74



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