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Finance

Gordon Growth Model

Stock valuation using dividend discount model

Runs locally in your browser

Parameters

Results

Fair value
$35.71
Dividend yield
7%

P = D₁ / (k − g). Assumes constant perpetual dividend growth.

How it works

Estimate intrinsic stock value using the Gordon dividend growth model.

Who it's for: Equity analysts valuing dividend-paying stocks with stable growth.

Formula: P = D₁ / (k − g) where k > g.

D₁ is the expected next dividend; g is perpetual growth rate; k is required return.

Also shows implied dividend yield at fair value.

How to use

  1. Enter D₁ (next dividend), Growth rate g (%), and Required return k (%).
  2. Read Fair value and Dividend yield.

Good to know

  • Requires k > g; the model assumes constant perpetual dividend growth.