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Terminal Value AMZN Quote Amazon.com

Growth in perpetuity method:
Long term growth rate
WACC (%) 14.4
Free cash flow (t+1) 65,905.75
Terminal Value 633,709.10
Present Value of Terminal Value 323,414.75
Now that we’ve estimated the free cash flow generated over the five-year forecast period, we need to estimate the value of ACME Corp.’s cash flows after that period (if we don’t include this, we would have to assume that ACME Corp. stopped operating at the end of the five-year forecast period). To do so, we’ll determine the company’s terminal value.