Terminal Value

Geo Group Inc (GEO)

$ 5.67
-0.1 (-1.73%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 5.40
Free cash flow (t + 1) 360.25
Terminal Value 25,732.23
Present Value of Terminal Value 19,782.19

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