Two-Stage Dividend Discount Model (DDM) & H-Model Stock Intrinsic Value Calculator

Value dividend stocks using a 2-stage high-growth + terminal Gordon Growth DDM.

Two-Stage DDM Intrinsic Value per Share
84.87 USD/sh
PV of Stage 1 Dividends (Yrs 1–N) 17.13 USD/sh
PV of Stage 2 Terminal Value 67.74 USD/sh
Terminal Value Share of Total 79.82 %
Inputs
⚡ Scenarios:
Amounts are treated in the selected currency; no foreign-exchange conversion is applied.
currency/sh
Current annual dividend per share (D₀).
%/yr
Stage 1 annual dividend growth rate (%).
years
Duration of high-growth Stage 1 in years.
%/yr
Perpetual terminal dividend growth rate g₂ (must be < Cost of Equity).
%/yr
Required rate of return / Cost of Equity k_e (%).
Results & Graph
Two-Stage DDM Intrinsic Value per Share
84.87 USD/sh
PV of Stage 1 Dividends (Yrs 1–N)
17.13 USD/sh
PV of Stage 2 Terminal Value
67.74 USD/sh
Terminal Value Share of Total
79.82 %

Two-Stage DDM Intrinsic Value per Share

Graph 1 • Two-Stage DDM Valuation • Domain Architecture & Live Telemetry Maps Current Annual Dividend D0, Stage1 High Growth Rate Pct, Stage1 Duration Years through Two-Stage DDM Valuation Formula.
PORTFOLIO & WEALTH MANAGEM Two-Stage DDM Intrinsic Va 84.87 USD/sh PV of Stage 1 Dividends (Y 17.13 USD/sh Two-Stage DDM Valuation • Component Waterfall Two-Stage DDM Intrinsic Value 84.87 USD/sh PV of Stage 1 Dividends (Yrs 1 17.13 USD/sh PV of Stage 2 Terminal Value 67.74 USD/sh Terminal Value Share of Total 79.82 %
Graph 2 • Two-Stage DDM Intrinsic Value per Share Across Current Annual Dividend D0 Sweep (40% → 160%) Evaluates V_0 = Σ [ D_0(1+g_1)^t / (1+k_e)^t ] + [ D_n(1+g_2) / (k_e − g_2) ] / (1 across 7 operating points (current input highlighted).
0 USD/sh 74.68 USD/sh 149.4 USD/sh 33.95 1.28 50.92 1.92 67.90 2.56 84.87 3.20 101.8 3.84 118.8 4.48 135.8 5.12
Graph 3 • Joint Sensitivity: Current Annual Dividend D0 × Stage1 High Growth Rate Pct Compares Two-Stage DDM Intrinsic Value per Share when Stage1 High Growth Rate Pct is shifted +25% (solid) vs. −25% (dashed).
0 USD/sh 68.56 USD/sh 137.1 USD/sh --- Stage1 High Growth Rate Pct @ 75% 67.12 -30% 81.51 -15% 95.89 +0% 110.3 +15% 124.7 +30%
Summary: Discounting 5 years of 12% dividend growth (USD 17.13 PV) plus a 4% terminal stage (USD 67.74 PV) at 9.5% Cost of Equity yields USD 84.87/share.
Summary: Discounting 5 years of 12% dividend growth (USD 17.13 PV) plus a 4% terminal stage (USD 67.74 PV) at 9.5% Cost of Equity yields USD 84.87/share.
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Formula & Mathematical Methodology: Two-Stage DDM Valuation Formula

V0 = Σ [ D0(1+g1)t / (1+ke)t ] + [ Dn1+g2ke − g2 ] / (1+ke)n
V_0 = Σ [ D_0(1+g_1)^t / (1+k_e)^t ] + [ D_n(1+g_2) / (k_e − g_2) ] / (1+k_e)^n
  • currentAnnualDividendD0: Current Annual Dividend D0 (currency/sh)
  • stage1HighGrowthRatePct: Stage1 High Growth Rate Pct (%/yr)
  • stage1DurationYears: Stage1 Duration Years (years)
  • stage2TerminalGrowthPct: Stage2 Terminal Growth Pct (%/yr)
  • costOfEquityRequiredReturnPct: Cost Of Equity Required Return Pct (%/yr)

Rounding: Currency outputs round to 2 decimal places; effective rates and multiples display to 2 decimal places.

Worked Example: Benchmark Scenario: Two-Stage DDM Valuation

Value dividend stocks using a 2-stage high-growth + terminal Gordon Growth DDM.

  1. Enter your financial, equity compensation, or tax parameters.
  2. Evaluate the governing equation: V_0 = Σ [ D_0(1+g_1)^t / (1+k_e)^t ] + [ D_n(1+g_2) / (k_e − g_2) ] / (1+k_e)^n.
  3. Review the primary result, supporting metrics, and 3 interactive SVG charts.
Result: Computes Two-Stage DDM Valuation via V_0 = Σ [ D_0(1+g_1)^t / (1+k_e)^t ] + [ D_n(1+g_2) / (k_e − g_2) ] / (1+k_e)^n.

Frequently Asked Questions

How does the Two-Stage Dividend Discount Model (DDM) & H-Model Stock Intrinsic Value Calculator calculate results?

It evaluates V_0 = Σ [ D_0(1+g_1)^t / (1+k_e)^t ] + [ D_n(1+g_2) / (k_e − g_2) ] / (1+k_e)^n directly in your browser and updates three custom SVG visualizations in real time.

Can I use Goal Seek to solve backwards for a target amount?

Yes. Click "🎯 Goal Seek" in the results toolbar to solve backwards for any numeric input parameter.

Are my financial and compensation numbers kept private?

Yes. All calculations execute 100% locally in your browser with zero server transmission.

Finance & Investing · Portfolio & Wealth Management

Two-Stage Dividend Discount Model (DDM) & H-Model Stock Intrinsic Value Calculator: inputs, method, and how to read the result

Value dividend stocks using a 2-stage high-growth + terminal Gordon Growth DDM.

Choose inputs for the case you are checking

The defaults are illustrative. Replace them with values for your case and keep the units shown beside each field.

  • Display Currency: Amounts are treated in the selected currency; no foreign-exchange conversion is applied.
  • Current Annual Dividend D0: Current annual dividend per share (D₀).
  • Stage1 High Growth Rate Pct: Stage 1 annual dividend growth rate (%).
  • Stage1 Duration Years: Duration of high-growth Stage 1 in years.

What the calculation includes

With the default values shown, Two-Stage DDM Intrinsic Value per Share is 84.87 USD/sh. The calculation follows Two-Stage DDM Valuation Formula; the formula and variable definitions above show how the inputs combine.

One-input check: With the other defaults held constant, changing Current Annual Dividend D0 from 3.2 currency/sh to 3.52 currency/sh changes Two-Stage DDM Intrinsic Value per Share from 84.87 USD/sh to 93.36 USD/sh. This is a comparison inside the calculator's stated model, not a prediction.

Where to use caution

  • Uses published statutory rules, standard compounding conventions, and marginal tax rates entered by the user.
  • For educational and financial planning analysis; consult a CPA or qualified advisor for personalized tax filings.

Scope: Global / US / India / UK / Canada / Australia Statutory Standards Check the assumptions and limitations against your situation before relying on the estimate.

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