Terminal growth rate
The rate at which the business grows beyond the forecast period — forever.
How to read the number
It cannot durably exceed the growth of the economy the company works in: otherwise the company would one day become larger than that economy.
When the metric lies
A small revision of this assumption changes the valuation more than reworking the entire forecast period. This is where models are most often bent towards a desired answer.
Also known as: perpetuity growth rate