Arguably the most important questions an investor must ask is: “How much is the stock actually worth?” There are many methods to answer this question. One popular method is the Gordon Growth Model.

Investors buy stocks to participate in the growth of a company. Many stocks reward investors with dividend payments, but how do you know whether you’re paying more for a stock than what it is worth?

Generally speaking, the stock market is driven by supply and demand, much like any market. When a stock is sold, a buyer and seller exchange money for share ownership. The price for which the stock is ...

JNJ and KO are two of my favorite current dividend plays yielding near 3%. Both are dividend aristocrats/kings and on sale. The Gordon Growth Model shows both as being undervalued with their ...

The formula for DYM draws on the frameworks of the Gordon Growth Model and Dividend Discount Model, which boils down to taking the current dividend yield and adding a growth estimate. The assumption ...

Use the dividend growth model to estimate fair stock prices based on future dividend growth. Be wary of model assumptions; real-world events like the pandemic can alter expected outcomes. Incorporate ...

Gordon Growth Model calculates stock value based on future dividends with steady growth. Inputs: current dividend, expected growth rate, required return rate. Effective for long-term investments in ...