Dividend Growth Model

The Dividend Growth Model, also known as the Gordon Model, is a fundamental analysis methodology for determining the value of a stock or business. This model is used as a strategy for investment based on the dividend yield. It values a company based on the dividends currently paid as well as the pattern of dividend growth that the company has displayed over time.  Although not all investors are comfortable with this

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How to Calculate Average Dividend Yield

Dividend Stock research

What We Have Learned So Far It is very important when investing to not only evaluate a company against others in its sector or industry, but also against itself. In previous articles, we have discussed the dividend payout ratio, free cash flow, Z-Score and Return on Invested Capital (ROIC). All of these metrics are used as a way to evaluate stocks against their peer group, but also against themselves at

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The Dividend Payout Ratio Explained

Evaluating the dividend payout ratio lets us focus on companies that have enough internal growth to give us those dividend increases that we want each year. As we know, these dividend increases will help our portfolio income beat inflation over time and provide us with a growing income in retirement. How To Calculate The Payout Ratio The dividend payout ratio is calculated by dividing the dividend paid by the net

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Why I Paid Off My Mortgage Early

As some of you might know, I have had a frequent battle with myself about whether or not to pay off my mortgage early. Because I was paying just 2.5% on the mortgage proceeds, it was a very difficult decision to sell off some of my equity holdings and liquidate some of my savings to pay the mortgage out completely. At the beginning of March 2012, I started selling off some stocks and

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