Risk Factor =

Dividend =

Dividend Growth Rate =

Stock Price =

Gordon's growth model is a way of measuring the market's perceived riskiness of a given stock. It assumes the dividend stream is perpetual and that the long-term growth rate is constant.

- Risk Factor%: discount rate associated with riskiness of the stock (the higher the percentage, the higher the market's perceived risk)

- Dividend: current dividend amount for the stock

- Dividend Growth Rate%: estimated dividend growth rate expressed as a percentage

- Stock Price: current price of the stock

A stock currently trading at $75 per share has a $4.25 dividend that is growing at 5% per year. What is the riskiness of this stock?

- Dividend: 4.25

- Dividend Growth Rate%: 5.000

- Stock Price: 75.00

The risk factor is 10.95%.

Risk Factor

Dividend

Dividend Growth Rate

Stock Price

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