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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting
QCOM 177.78-2.2%Jan 9 9:30 AM EST

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To: Jim Mullens who wrote (31374)1/19/2003 10:04:58 AM
From: kech   of 197146
 
Nice article Jim - showing the linkage between dividend growth model formula and PEG ratios. Most people in finance use the formula for perpuity to value the stub part of the valuation of a project after the immediate growth and cash flows - say first 5 or even 10 years).

The perpetuity model of course has strong assumptions about a growth rate that will continue for a long time and so using this means that people often put in very conservative growth rates and high discount rates for this part of the valuation. At least that is how I use it.
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