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
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
Well, yes, I use several services:
- Roic.ai - great for long term economic data
- Seekingalpha - Great to read up and get an impression on certain companies
- Yahoo Finance for some quick economic data
- Tradingview for charts
All these are tools that support my investing process, I will make a substack about my Investing strategy and process soon to explain in more detail
I prefer lifco or cs
Yeah, me too. Still think Roper is an interesting business
Would be great if you can share in detail your DCF process, thanks for sharing
Alright, I will, thank you for the feedback!