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Value of Stock Formula

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Value of Stock refers to shares of a company that appears to trade at a lower price relative to its fundamentals. Check FAQs

s = \frac{EDPS}{CCE - DGR}

s - Value of Stock?EDPS - Expected Dividend Per Share?CCE - Cost of Capital Equity?DGR - Dividend Growth Rate?

Value of Stock Example

With values

With units

Only example

Here is how the Value of Stock equation looks like with Values.

Here is how the Value of Stock equation looks like with Units.

Here is how the Value of Stock equation looks like.

40 = \frac{200}{25 - 20}

40 = \frac{200}{25 - 20}

40 = \frac{200}{25 - 20}

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Value of Stock Solution

Follow our step by step solution on how to calculate Value of Stock?

FIRST Step Consider the formula

s = \frac{EDPS}{CCE - DGR}

Next Step Substitute values of Variables

∴

s = \frac{200}{25 - 20}

Next Step Prepare to Evaluate

∴

s = \frac{200}{25 - 20}

LAST Step Evaluate

∴

s = 40

Value of Stock Formula Elements

Variables

Value of Stock

Value of Stock refers to shares of a company that appears to trade at a lower price relative to its fundamentals.

Symbol: s

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Value of Stock

Expected Dividend Per Share

Expected Dividend Per Share is the expected sum of declared dividends issued by a company for every ordinary share outstanding.

Symbol: EDPS

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Expected Dividend Per Share

Cost of Capital Equity

The Cost of Capital Equity refers to the financial returns investors who invest in the company expect to see.

Symbol: CCE

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Cost of Capital Equity

Dividend Growth Rate

The Dividend Growth Rate is the annualized percentage rate of growth that a particular stock's dividend undergoes over a period of time.

Symbol: DGR

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Dividend Growth Rate

Other formulas in Basics of Financial Accounting category

Go Discount Percentage

D% = (\frac{LP - SP}{SP}) \cdot 100

Go Depletion Charge per Unit

DC = \frac{OC - RV}{n Depletion}

Go Shareholders' Equity given Total Assets and Liabilities

TSE = TA - TL

Go Shareholders' Equity given Share Capital, Retained Earnings and Treasury Shares

TSE = SC + RE - TS

How to Evaluate Value of Stock?

Value of Stock evaluator uses Value of Stock = Expected Dividend Per Share/(Cost of Capital Equity-Dividend Growth Rate) to evaluate the Value of Stock, Value of Stock is a way to determine the value of the shares of a company and whether they are fair, over-valued, or under-valued. Value of Stock is denoted by s symbol.

How to evaluate Value of Stock using this online evaluator? To use this online evaluator for Value of Stock, enter Expected Dividend Per Share (EDPS), Cost of Capital Equity (CCE) & Dividend Growth Rate (DGR) and hit the calculate button.

FAQs on Value of Stock

What is the formula to find Value of Stock?

The formula of Value of Stock is expressed as Value of Stock = Expected Dividend Per Share/(Cost of Capital Equity-Dividend Growth Rate). Here is an example- 40 = 200/(25-20).

How to calculate Value of Stock?

With Expected Dividend Per Share (EDPS), Cost of Capital Equity (CCE) & Dividend Growth Rate (DGR) we can find Value of Stock using the formula - Value of Stock = Expected Dividend Per Share/(Cost of Capital Equity-Dividend Growth Rate).

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Value of Stock Formula

Value of Stock Example

Value of Stock Solution

Value of Stock Formula Elements

Other formulas in Basics of Financial Accounting category

How to Evaluate Value of Stock?

FAQs on Value of Stock

Variable Name