There are two standard methods: the perpetuity growth approach, which capitalises the final year's cash flow at the discount rate less perpetuity-growth-rate, and the exit-multiple-method, which applies a multiple to final-year EBITDA.
Because terminal value often contributes 60% to 80% of the answer, a DCF is mostly an argument about the terminal assumption wearing a forecast as a disguise. Always show what the implied exit multiple is under the perpetuity method, and vice versa.
Example: Northwind Tools has $111M of year-five unlevered free cash flow growing at 2.5% forever, discounted at 8.1%. Terminal value is $2.03B, and its present value of $1.38B is 62% of the total.
Related: perpetuity-growth-rate, exit-multiple-method, discounted-cash-flow, present-value, sensitivity-analysis