# Dividend discount model (stock valuation model)

- Canonical URL: https://www.gerhardmerk.de/dividend-discount-model-stock-valuation-model
- Post ID: 592022
- Modified: 2023-07-25T21:01:22+00:00
- Language: en

## Definition

The assumption that a company's current share price is determined - from the expected dividend payments - discounted by the investors' underlying return for holding the share in question (cost of equity: the risk-free interest rate plus equity risk premium). - Cf. ECB Monthly Bulletin, July 2008, pp. 35 ff. (calculation of the cost of equity using a model; overviews). Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express consent! University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec. Professor Dr. Eckehard Krah, Dipl.rer.pol. E-mail address: info@ekrah.com https://de.wikipedia.org/wiki/Gerhard_Ernst_Merk https://www.jung-stilling-gesellschaft.de/merk/ https://www.gerhardmerk.de/

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