A formula to calculate the constant dividend supported growth rate of mature companies with a low beta and low growth rate. The model operates on the assumption that dividends will increase infinitely and will outpace the stock price's growth, and is only an idealized calculation for select large-cap companies in stable sectors.D = Dividend per share forecast for next year; R = Required rate of return for the investor; G = Growth rate in dividends. Stock Value = D / (R - G)
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The equation most always used is called the Gordon growth model. It is named after Myron J. Gordon, who originally published it in 1959; although the ...
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A model for determining the intrinsic value of a stock, based on a future series of dividends that grow at a constant rate. Given a dividend per share that is ...
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Mar 31, 2011 ... Learn how to calculate the value of a stock using the Gordon growth model -- a simple tool that can save you time and money.
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Definition of Gordon Growth Model. Gordon Growth Model is a model to determine the fundamental value of stock, based on the future sequence of dividends ...
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Some obvious candidates for the Gordon Growth Model. • Regulated Companies, such as utilities, because. • their growth rates are constrained by geography ...
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Gordon Growth Model. Also found in: Wikipedia, 0.02 sec. Gordon Growth Model. A simple model to estimate the value of a stock. The model assumes one ...
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The Gordon growth model is a tool that is commonly used to value stocks. Originally developed by Professor Myron Gordon and also known as Gordon's growth ...
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May 18, 2011 ... The Gordon growth model is a simple discounted cash flow (DCF) model which can be used to value a stock, mutual fund, or even the entire ...