27. We can use Thomson ONE to value stocks with the Gordon Model. We’ll illustrate with Sherwin Williams (SHW), a stable paint manufacturer.

Access Sherwin in Thomson ONE and calculate growth rates for dividends, earnings per share, and revenues. Select a rate you think reflects the company’s potential. Use it and the most recent dividend to estimate intrinsic value assuming a modest 7% or 8% return. Find Sherwin’s current stock price. Is it a good buy? Vary your assumptions about growth rate and return. What does it take to get an intrinsic value in line with the market’s thinking?

Now try to do the same thing for the companies we worked on before.

Summarize the problems you encounter. Do you think a two-stage Gordon model might work for Harley-Davidson?