Valutico
MAY 6, 2024
Since cash flow projections cannot be made indefinitely, a terminal value is often calculated to account for the value of cash flows extending beyond the forecast period. The terminal value can be estimated using the perpetuity growth model or the exit multiple approach.
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.”.
Brian DeChesare
APRIL 19, 2023
New or Tweaked Valuation Methodologies – As in the E&P segment of oil & gas, there’s also a Net Asset Value (NAV) model for mining companies, and it’s set up similarly (essentially, it’s a long-term DCF with no Terminal Value). OK, now to the good news: This situation is starting to change.
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