Terminal Value
Xenia Hotels & Resorts, Inc. (XHR)
$12.06
-0.31 (-2.51%)
| Growth in perpetuity method: | |
|---|---|
| Long-term growth rate | |
| WACC (%) | 10.59 |
| Free cash flow (t + 1) | 342.35 |
| Terminal Value | 3,985.45 |
| Present Value of Terminal Value | 2,409.34 |
Now that we’ve estimated the free cash flow generated over the five-year forecast period, we need to estimate the value of Xenia Hotels & Resorts, Inc.’s cash flows after that period (if we don’t include this, we would have to assume that Xenia Hotels & Resorts, Inc. stopped operating at the end of the five-year forecast period). To do so, we’ll determine the company’s terminal value.