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HOSTING A TOTAL OF 318 FORMULAS WITH CALCULATORS

Dividend Discount Model

The dividend discount model (DDM) is a method of valuing a company based on the theory that a stock is worth the discounted sum of all of its future dividend payments.In other words, it is used to value stocks based on the net present value of the future dividends. The equation most widely used is called the Gordon growth model.

d 1 r-g

Here,g=constant growth rate,r=constant cost of equity,d1=value of the next year dividens

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