ModeldrillTerminal value by exit multiple
A financial modeling exercise from Modeldrill. Solve it with a live spreadsheet grid in your browser, with Fill right and Fill down, and it is checked the moment you submit.
The task
Value the business assuming it is sold at the end of year 5 for the EBITDA multiple in B3. Fill the terminal value (B10), its present value (B11), the present value of the five cash flows using SUMPRODUCT (B12), enterprise value (B13) and the share of value that comes from the terminal value (B14).
What this exercise teaches
An exit multiple ties the terminal value to how similar businesses trade. Checking the terminal share keeps you honest: here most of the value sits beyond the forecast.
A hint if you get stuck
The multiple applies to EBITDA, not to free cash flow. SUMPRODUCT multiplies two rows pair by pair and adds the results.
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