Brian DeChesare

MAY 3, 2023

The DDM is more grounded because it’s based on the company’s actual distributions and potential future value. And it values the company today based on the present value of its dividends and that potential future value (either the stock price or the Equity Value via the Terminal Value calculation).

Dividends 64

Dividends Terminal Value Enterprise Value Equity 64

Valutico

OCTOBER 20, 2022

Well, the short answer is after that forecast period where we estimate each year’s cash flows then discount them, we add a single number at the end to account for all the theoretical years in the future, called the Terminal Value (TV). Explaining The Terminal Value. How do I calculate the Terminal Value?”

Discounted Cash Flow 52

Discounted Cash Flow Terminal Value Weighted Average Cost of Capital Net Present Value 52

Valutico

MAY 6, 2024

Analysts use financial metrics and multiples such as Price to Earnings (P/E), Enterprise Value to EBITDA (EV/EBITDA), and Price to Book (P/B) ratios and apply them to the target company’s financials. The terminal value can be estimated using the perpetuity growth model or the exit multiple approach.

Discounted Cash Flow 52

Discounted Cash Flow Precedent Transaction Analysis Weighted Average Cost of Capital Comparable Company Analysis 52

Brian DeChesare

AUGUST 10, 2022

Essentially, the NAV Model is a super-long-term DCF without a Terminal Value. The Terminal Value doesn’t make sense in this vertical because oil and gas resources are finite; you can’t assume that a company will keep producing “forever.”.

Banking 98

Banking EBITDA Dividends Equity 98