HOSTING A TOTAL OF 318 FORMULAS WITH CALCULATORS

## Present Value of Stock with Constant Growth

Present value of a stock with constant growth is the estimated dividends to be paid divided by the difference between the required rate of return and the growth rate.

The present value of a stock with constant growth is one of the formulas used in the dividend discount model, specifically relating to stocks that the theory assumes will grow perpetually. The dividend discount model is one method used for valuing stocks based on the present value of future cash flows, or earnings.

## $\frac{d}{r-g}$

Here,d=estimated dividends for next period,r=required rate of return,g=growth rate.

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