Terminal Value
Vanguard S&P Small-Cap 600 Growth I... (VIOG)
$93.85
+1.18 (+1.27%)
| Growth in perpetuity method: | |
|---|---|
| Long-term growth rate | |
| WACC (%) | - |
| Free cash flow (t + 1) | - |
| Terminal Value | - |
| Present Value of 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 Vanguard S&P Small-Cap 600 Growth Index Fund’s cash flows after that period (if we don’t include this, we would have to assume that Vanguard S&P Small-Cap 600 Growth Index Fund stopped operating at the end of the five-year forecast period). To do so, we’ll determine the company’s terminal value.