Present Value Models – Dividend Discount Models

  • [e] Present value models (dividend discount and free-cash-flow-to-equity models).
  • [g] Intrinsic value of a non-callable, non-convertible preferred stock.
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Terms covered: Present value models, Dividend Discount Model, FCFE, FCFE  model, CAPM, Preferred stock

Valuation Sensitivity Analysis

See how a stock’s value changes based on growth and risk.

Last Dividend (D₀) $5.00
Terminal Price (P₃) $122.00

Calculated Intrinsic Value (V₀)

$107.87

Adjust the sliders to see the impact on the stock’s value.

Calculation Breakdown

Year Future Cash Flow (FV) Present Value (PV)
1 (Dividend) $5.20 $4.77
2 (Dividend) $5.41 $4.55
3 (Dividend) $5.62 $4.34
3 (Terminal Value) $122.00 $94.21
Total Intrinsic Value (V₀) $107.87