Terminal Value

PIMCO Corporate & Income Opportunit... (PTY)


-0.01 (-0.08%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 5.04
Free cash flow (t + 1) 131.27
Terminal Value 4,317.98
Present Value of Terminal Value 3,376.81

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