The Dividend Discount Model Calculator is used to calculate the value of a stock based on the dividend discount model.
Dividend discount model, or DDM, is a stock valuation approach that has been developed to value a stock on the basis of estimated future dividends, discounted to reflect their value in today’s terms.
There are several variations of dividend discount models, but their central basis is the following formula:
Stock Value = Dividends per Share / (Discount Rate – Dividend Growth Rate)