Question
Fill in the blanks with the correct words 3. If a stock is paying $5 per share dividend every year, and the discount rate is
Fill in the blanks with the correct words
3.
If a stock is paying $5 per share dividend every year, and the discount rate is 10.0000% the value of the stock would be (1)__________ dollars under the dividend discount model.
When valuing businesses with the dividend discount model, the result is heavily influenced by the (2)__________.
Instead of dividends, (3)__________ can be used to value a stock.
If XYZ Co. has an annual cashflow of $1,000,000,000.00, and the shares of a similar company is trading at a multiple of 10 times cashflow, XYZ shares would be valued at (4)__________ dollars if XYZ has 100,000,000 shares outstanding.
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