Question

How do I find the current price of a stock when the rate is not constant? Please give a formula step by step answer I'm so confused

Answer 1

Answer:

There is no affirmative formula, but this is the basics

Step-by-step explanation:

DDM Formula=

Stock value = Dividend per share / (Required Rate of Return – Dividend Growth Rate)

Rate of Return = (Dividend Payment / Stock Price) + Dividend Growth Rate.

The P/E Ratio. The price-to-earnings ratio or P/E ratio is a popular metric for valuing stocks that works even when they have no dividends. Regardless of dividends, a company with high earnings and a low price will have a low P/E ratio. Value investors see such stocks as undervalued.

The current price is the most recent selling price of a stock, currency, commodity, or precious metal that is traded on an exchange and is the most reliable indicator of that security's present value.

The formula consists of taking the DPS in the period by (Required Rate of Return – Expected Dividend Growth Rate). For example, the value per share in Year is calculated using the following equation: Value Per Share ($) = $5.15 DPS ÷ (8.0% Ke – 3.0% g) = $103.00.

Briefly, in order to be eligible for payment of stock dividends, you must buy the stock (or already own it) at least two days before the date of record. That's one day before the ex-dividend date.