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Economy & Business, Volume 9, 2015

ACCURACY OF DIVIDEND DISCOUNT MODEL VALUATION AT MACEDONIAN STOCK- EXCHANGE
Zoran Ivanovski, Zoran Narasanov, Nadica Ivanovska
Pages: 73-83
Published: 20 Jun 2015
Views: 1458
Downloads: 588
Abstract: Many analysts believed that Dividend Discount Model (DDM) is obsolete, but much of the intuition that drives discounted cash flow (DCF) valuation is embedded in the DDM model. The basic task of these research is to test DDM valuation models accuracy at Macedonian Stock Exchange (MSE) as emerging market by analyzing two “blue-chip” stocks, one from banking sector and other from industry. The descriptive statistics and regression analysis were used to determine the level of correlation between the stocks’ intrinsic value and stock market prices as well as to determine statistical significance of companies’ dividends policies and dividend levels for future stock market prices forecasting.
Keywords: valuation, securities, free cash flow, dividends, equity, regression
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