The underlying assumption of the dividend growth model is that a stock is worth:

• The present value of the future income that the stock is expected to generate.
• The same amount to every investor regardless of their desired rate of return.
• An amount computed as the next annual dividend divided by the market rate of return.
• An amount computed as the next annual dividend divided by the required rate of return.
• The same amount as any other stock that pays the same current dividend and has the same required rate of return.