The Gordon Growth Model, also known as the dividend discount model, is used to determine the intrinsic value of a stock based on future dividends.
Free Cash Flow to Equity (FCFE) is a measure of how much cash is available to a company’s equity holders after all expenses, investments, and debt payments have been made.
Scanner Rules:
- Free cash flow last year /Market Capitalization >0.25
- Market Capitalization >10000
- Current price >50
- Free cash flow 3years >0
- Free cash flow last year >0
- Price to Free Cash Flow >0
The Gordon Growth Model assumes that the future growth rate of dividends will remain constant, which may not always be the case. FCFE, on the other hand, relies on accurate financial statements and projections, which may not always be available or reliable. This screener takes the best rules from both theories.