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What is Terminal Value Estimation in Valuation about?
- There are two main methods for calculating a terminal value in dividend discount models: using the Gordon Growth Model or using market multiples like P/E ratios. - The two-stage dividend discount model assumes high growth initially that transitions to stable long-term growth. It values the company as the present value of dividends in the high growth period plus the terminal value. - The H-model approximates declining growth rates over time using a linear decline over the high growth period rather than
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- Documentos26
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- EN