discussion board reply response 1

Initial Question:

You have been asked to perform and present a stock valuation to the CEO prior to the annual shareholders meeting next week. The two models you have selected to value the firm are the dividend discount model and the discounted cash flow model. Explain why the estimates from the two valuation methods differ. Address the assumptions implicit in the models themselves as well as those you made during the valuation process.

Reply to this part:

To complete a stock valuation many pieces of information are

required to include; the type of stock, stock prices for the last period,
current prices, the earnings per share, annual sales, etc. A stock valuation is
the process of calculating the fair market value of a stock by using a fixed
formula that considers various economic indicators. Stock valuation can be
calculated using several different methods but for this DQ we will be using the
dividend discount model and the discounted cash flow model. The dividend
discount model is a technique of valuing a company’s stock price based on the model
that its stock is worth the sum of all its future dividend payments, discounted
back to their present value. The discounted cash flow model is a method of
valuation in which future cash flows are discounted back to a present value
using the time-value of money. The results from the divided discount model are
not as reliable as they assume that the growth rate is stable, continuous and
less than the amount of capital required to produce the product. The discounted
cash flow model uses future cash flow projections and discounts them using an
annual rate to find a present value estimation. The present value is then used
to evaluate the stock in this case. If the present value is estimated at more than
the investment, then the stock is a good one. In the divided discount model, the type of
stock can change the equation, and for this example we will assume this is a
common stock. The stocks projected value after a year using the divided discount
model would be determined by an equation including the cost per share, the rate
of return in a percentage, and the price per share. If this stock had a closing
share price of $30 at year end, a common equity per share of $.25, and a rate
of return at 10% the projected value per share would be $27.50. This would be a
good return on investment and a fairly reliable model to use in the valuation
of the stock for the upcoming meeting.


Brigham, E. F., & Ehrhardt, M. C. (2017). Financial management: Theory and practice (15th ed.). Mason, OH: South-Western

APA, At least one reference. 100-200 words.


Do you need a similar assignment done for you from scratch? We have qualified writers to help you. We assure you an A+ quality paper that is free from plagiarism. Order now for an Amazing Discount!
Use Discount Code “Newclient” for a 15% Discount!

NB: We do not resell papers. Upon ordering, we do an original paper exclusively for you.


“Are you looking for this answer? We can Help click Order Now”

The post discussion board reply response 1 first appeared on Nursing Essays Writers.


“Looking for a Similar Assignment? Get Expert Help at an Amazing Discount!”

The post discussion board reply response 1 first appeared on nursing writers.

Order a similar paper and get 15% discount on your first order with us

Dr. Padma Myers
Dr. Padma Myers
98% Success Rate
Read More
“Hello, I deliver nursing papers on time following instructions from the client. My primary goal is customer satisfaction. Welcome for plagiarism free papers”
Stern Frea
Stern Frea
98% Success Rate
Read More
Hi! I am an English Language and Literature graduate; I have written many academic essays, including argumentative essays, research papers, and literary analysis.
Dr. Ishid Elsa
Dr. Ishid Elsa
98% Success Rate
Read More
"Hi, count on me to deliver quality papers that meet your expectations. I write well researched papers in the fields of nursing and medicine".
Dr. Paul P. Klug
Dr. Paul P. Klug
99% Success Rate
Read More
"A top writer with proven reliability and experience. I have a 99% success rate, overall rating of 10. Hire me for quality custom written nursing papers. Thank you"

How Our Essay Writing Service Works

Tell Us Your Requirements

Fill out order details and instructions, then upload any files or additional materials if needed. Then, confirm your order by clicking “Place an Order.”

Make your payment

Your payment is processed by a secure system. We accept Mastercard, Visa, Amex, and Discover. We don’t share any informati.on with third parties

The Writing Process

You can communicate with your writer. Clarify or track order with our customer support team. Upload all the necessary files for the writer to use.

Download your paper

Check your paper on your client profile. If it meets your requirements, approve and download. If any changes are needed, request a revision to be done.

Recent Questions

Stay In Touch!

Leave your email and get discount promo codes and the best essay samples from our writers!