Section 5
Stock Valuation
Book
Version 3
By Boundless
By Boundless
Boundless Finance
Finance
by Boundless
5 concepts
Expected Dividends, No Growth
A no-growth company would be expected to return high dividends under traditional finance theory.
Expected Dividends and Constant Growth
Valuations rely heavily on the expected growth rate of a company; past growth rate of sales and income provide insight into future growth.
Relationship Between Dividend Payments and the Growth Rate
The portion of the earnings not paid to investors is, ideally, left for investment in order to provide for future earnings growth.
Understanding Future Stock Value
There are many different ways to appraise the future value of stocks, including fundamental criteria and stock valuation methods.
Valuing Nonconstant Growth Dividends
Limited high-growth approximation, implied growth models, and the imputed growth acceleration ratio are used to value nonconstant growth dividends.