Read more on the stable growth rate

The
only constraint on the stable growth rate is that it be less than
the growth rate of the economy in which you operate. If you are
working with nominal cashflows, this would be a nominal growth
rate in the economy; with real growth rates, it would be a real
growth rate for the economy. The growth rate can be 0% or negative.
In fact, given what we know about firm life cycles where firms
peak and then become smaller over time, you can argue that assuming
a negative growth rate is more realistic than assuming that your
firm will keep getting larger over time. 