| Dividend
Discount Model - DDM |
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A
procedure for valuing the price of a stock by using predicted dividends
and discounting them back to present value. The idea is that if the
value obtained from the DDM is higher than what the shares are currently
trading at then the stock is undervalued.
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This
procedure has many variations and does not work for companies that
do not pay out dividends. |
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Dictionary
