To estimate the intrinsic value of a company,investors could use the dividend discount model to estimate intrinsic value,or an earnings multiplier model based on a forecast of next year's EPS and what is thought to be an appropriate P/E ratio.

Question

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The dividend discount model and earnings multiplier model are both commonly used methods for estimating the intrinsic value of a company. The dividend discount model estimates the present value of future dividend payments, while the earnings multiplier model uses a forecast of next year's earnings per share (EPS) and an appropriate price-to-earnings (P/E) ratio.

To Estimate the Intrinsic Value of a Company,investors Could Use