Dividend Discount Model Valuation of Coca-Cola Introduction Valuation of companies gives a value at which each company stock costs in the market. Hence, investors are interested to know the true value of Coca-Cola stocks so that when they invest in the company, they can buy stocks at the prices that will enable them to make profits. There are many approaches to valuing companies, and the dividend discount model is one of the approaches used to value companies. The DDM is preferred over other valuation approaches because it considers dividends which are the earnings investors will realize from their investments. Additionally, the dividend discount model is more accurate than other valuation models in that it uses future dividend earnings to estimate the value an investor should pay for a stock today. This analysis gives the value of Coca-Cola shares using the dividend discount model. The analysis also explains the assumptions made in the valuation process. Additionally, the analysis compares the intrinsic value of Coca-Cola derived from the dividend discount model with the current value of the company’s stocks to check if the model can accurately estimate the value of a company’s stocks. Incidentally, the summary section reviews the main takeaways from the analysis, and it states whether the DDM is a good valuation model or otherwise.
Buy this excellently written paper or order a fresh one from ace-myhomework.com
