Terminal Value

Huntington Ingalls Industries Inc

Huntington Ingalls Industries Inc (HII)

$163.73
0.56 (+0.34%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 8.92
Free cash flow (t + 1) 640.72
Terminal Value 13,022.85
Present Value of Terminal Value 8,495.09



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