Terminal Value

Francesca's Holdings Corp

Francesca's Holdings Corp (FRAN)

-0.25 (-10.04%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 12.08
Free cash flow (t + 1) 29.50
Terminal Value 365.11
Present Value of Terminal Value 206.43

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