Terminal Value

White Mountains Insurance Group Ltd

White Mountains Insurance Group Ltd (WTM)

$775.35
18.35 (+2.42%)
Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.03
Free cash flow (t + 1) 6,177.09
Terminal Value 203,864.36
Present Value of Terminal Value 145,148.88



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