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The dividend growth model projects future dividend payments based on a constant growth rate. Used to estimate intrinsic stock value assuming dividends grow perpetually.

Wzór

Stock Value = D₁ / (r - g) where D₁ is next dividend and r is required return

Przewodnik krok po kroku

  1. 1Enter current dividend, growth rate, and required return
  2. 2Calculate next year's dividend
  3. 3Divide by the difference between required return and growth rate

Rozwiązane przykłady

Wejście
Current div: $2, growth: 5%, required return: 10%
Wynik
Stock value ≈ $42
$2.10 / (0.10 - 0.05)

Częste błędy do unikania

  • Assuming growth rate exceeds required return
  • Using current instead of next dividend

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