Terminal Value

Wingstop Inc. (WING)

$134.13

+4.37 (+3.37%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 8.57
Free cash flow (t + 1) 51.22
Terminal Value 779.67
Present Value of Terminal Value 516.84



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