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Terminal multiple is the multiple we asign to the FCF at the end of the 10 year period. So after 10 years, given X amount of growth, I assume that the business will be valued at 15-25 times FCF. So yes, it is sort of the PE, but as we use FCF here it is PFCF. If you were to use EPS, it would be the PE of the business at the end of the period.

I usually make an educated, conservative guess on this value

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Jun 2, 2023Liked by Invest In Assets πŸ“ˆ

I prefer lifco or cs

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Apr 16, 2023Liked by Invest In Assets πŸ“ˆ

Would be great if you can share in detail your DCF process, thanks for sharing

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