Help With Dividend Discount Model

I'm trying to build a Dividend Discount Model to value financial institutions and I'm having some issues, and I was wondering if you guys could help out.

I followed the guide here: https://www.youtube.com/watch?v=sdV1KyPzCQs

But when I used the data for WFC, there were two serious errors that I am having trouble rectifying.

1) There is a huge drop off from CY13 SE to the projected CY14 SE in the model (I assume because WFC has more than enough equity to cover their Basel requirements)

Dividends, Share repurchase and Debt schedules

In ER, how do analysts project dividends, share repurchases if the company has made no public announcement. For a dividend, I think you can estimate if the company is using payout ratios or has a fixed dividend policy but how will you go about share repurchases if nothing is available (or if the company just says we'll buy $10b of shares over the next 5 years-do you just take average for the next 3 years?)

Hello world! ideas from a Berkeley student

Hello world!

I am a student programmer, solid state physicist, chemist, and entrepreneur. In short I love numbers. Here are some:

6.51% in 13 days
4.55% in 12 days

These were my only two picks to start my fund, DXJ and AAPL, respectively. The S&P500 went up 2.4% the same period. The dividend yield is 2.2% and I'm writing options to cash out on theta. Read my next blog to see my explanation for why japan is in a bull market, the yen will devalue, and apple is back.

Ridiculous 1 Time Special Dividends...

Soo companies like Costco, Walmart etc are issuing 1 time special dividends this quarter before January 1st at like 7%...

discussion 1: is this just a way for management with holdings to make $ while the tax rate is at 15% and not 40% in-case we go over the fiscal cliff? a way to give back to shareholders and allow them to take in CFs while its still at 15%? Easy to do since its debt financed and treasury rates are so low that they can issue low interest rate on debt? whats the real rationale you guys think? shouldnt this help the future valuation of the stock? ex- current price is just PV of all implied predicted future CFs of the stock (both share price and dividend related increase)...this includes dividends ?

The "dividend tax" cliff approaches: Implications for stocks

A great deal has been written about the "fiscal cliff" that US taxpayers, investors and companies are faced with at the end of this year. Put simply, all of the tax changes made in 2002 and 2003 expire at that time, and the tax code will, in large part, revert to what it was prior to those changes. I will leave it to others to debate the macro economic implications of going over the cliff but I want to focus on one "segment" of the code that has implications to valuation.

In 2003, the tax code was altered to bring the tax rate on dividend income down to 15%, to match the tax rate on capital gains. That was, in a sense, a revolutionary move, at least for the US, since dividends had been taxed much more heavily than capital gains for much of the previous century. I did write a paper in 2003 about the potential implications of the tax law change for businesses that you can read. In effect, I argued that the tax change would have a positive effect on stock prices, that the effect would be greater for "high" dividend paying stocks than for non-dividend paying stocks and that corporate dividend policy would be altered by the change. Now that there is the possibility that the law will be reversed, it is time to revisit the issue.


Dividends, Expected Returns and Stock Prices: Why taxes matter...

Options dividend ex date question

Assume a customer holds 1 ABC Oct 60 Put contract. The market price of ABC is currently $60. On an ex-date with a dividend of $4, the new market price is $56. The contract is still a ABC Oct 60 put correct? The strike and multiplier do not change? So what happens to the premium? Does it just jump up around $4 (there's still time value so it's probably around $4, not exactly)? Why is this? What's the logic?

Sorry I'm studying for my series 56 and my book doesn't have a clearer explanation.

Emotions, Intrinsic value and Dividend Clienteles: The Apple trade postscript

Now that I have read some of the reactions to my post on "folding" on Apple, I would like to respond to at least three issues that were raised in these responses. The first was that my sale of Apple seemed to be grounded more in emotional than in fundamental reasons. The second and related point was that the sale of the stock at a price that was below my own estimate of intrinsic value was not consistent with intrinsic value investing. The third was a more general question of whether or when I would return to the fold of Apple stockholders.

1. The "emotional" trade

Dividend Reinvesting

I own a bunch of dividend stocks and was wondering if it's worth it to reinvest the dividends? For those of you who invest in dividend stocks, do you reinvest your dividends and why/why not? Also what happens if you have fractions of stocks that have been purchased automatically with the dividends- how do you sell 103.47 shares of something? Thanks.

6 Large-Cap Undervalued Stocks with High Dividend Yields

We have been urging investors to focus on high dividend stocks for the past year. The problem is, most people don’t know how to time the market. Dividend-yielding stocks are valued like any other stocks, and, like other investments, when they are undervalued is the best time to buy. We used price-to-book and price-to-earnings ratios to pick the most undervalued stocks.

Would it work? Stock Price Boost for Research in Motion (RIMM)

Research in Motion has had round after round of bad news, and the stock now trades at $18.85, which is hovering around book value. They need to do something to right the ship quickly. 40.3M shares are sold short, or Short Interest as % of Float 8.57%. That's from Scottrade fundamental charts, so the accuracy might not be spot on, but, essentially, a large portion of the shares are sold short.

With so many shares sold short, why don't they use some of that cash they have + take on some debt and pay a special one time dividend. They could use a good portion of the money they borrow to go towards speeding up their product pipeline, while using the rest + extra cash on hand to pay a large dividend?

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