Guided Walkthroughs
Full DCF — Step 9 of 12: Compute terminal value the second way — a 6.5x EV/EBITDA exit multiple — and cross-check the two methods against each other.
Model answer
Exit multiple TV = Year 5 EBITDA × multiple = 45 × 6.5 = $292.5M (as of end of Year 5). Cross-check both directions: (1) the Gordon TV of 286.9 implies an exit multiple of 286.9 / 45 ≈ 6.4x — right…
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More from Guided Walkthroughs
- Full DCF — Step 1 of 12: Set up the model. SteadyCo has $100M of revenue in Year 0. What operating assumptions do you need before you can project unlevered free cash flow, and what are ours?
- Full DCF — Step 2 of 12: Project SteadyCo's revenue and EBITDA for Years 1–5.
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- Full DCF — Step 4 of 12: State the unlevered FCF formula and compute Year 1 unlevered FCF for SteadyCo.
- Full DCF — Step 5 of 12: Complete the 5-year unlevered FCF projection.
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