Publication number: ELQ-60016-1
View all versions & Certificate
Gordon Growth Model
Value the equity in a stable firm paying dividends, with stable growth
Prof. Aswath Damodaran offers you this business tool for free!
download for free
This is the output from the Gordon Growth Model
- Current Dividends per share
- Cost of Equity
- Expected Growth rate
Best suited for firms growing at the same rate as the economy and paying residual cash as dividends.
Assumptions in the model:
1. The firm is in steady state and will grow at a stable rate forever.
2. The firm pays out what it can afford to in dividends, i.e., Dividends = FCFE.
People using this tool also downloaded
Any questions on Gordon Growth Model?
The user community and author are here to help. Go ahead!