However, if you look at the chart, my Excel spreadsheet gives me two more results according to a discount rate of 6.79% (-1%) and 8.79% (+1%). Interesting enough, the intrinsic value of $211.18 ...

Which gives us a share price of $19.33. Currently, as of 5/22/2017 GE is trading at $28.18, so the dividend discount model would lead us to believe that GE is currently overpriced.

An example of the dividend discount model Let's say that a certain stock is expected to make a $1 dividend payment next year. If its dividend has historically grown by 5% per year, it's fair to ...

Example: Dividend Growth and Stock Valuation To value a company’s stock, an individual can use the dividend discount model (DDM). The dividend discount model is based on the idea that a stock is ...