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Terminal Value NVR Quote NVR Inc.

Growth in perpetuity method:
Long term growth rate
WACC (%) 7.7
Free cash flow (t+1) 1,056.05
Terminal Value 28,541.79
Present Value of Terminal Value 19,697.12
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.