Terminal Value

Sol-Gel Technologies Ltd. (SLGL)


-0.23 (-5.60%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 11.11
Free cash flow (t + 1) -36,785,126,502.61
Terminal Value -403,788,435,813.54
Present Value of Terminal Value -238,444,955,472.87

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