Investors buy stocks to participate in the growth of a company. Many stocks reward investors with dividend payments, but how do you know whether you’re paying more for a stock than what it is worth?

Third-party model portfolios had $646 billion in assets under advisement as of March 31, 2025—an increase of 62% since Morningstar last surveyed for assets in June 2023, less than two years ago.

Gordon Growth Model calculates stock value based on future dividends with steady growth. Inputs: current dividend, expected growth rate, required return rate. Effective for long-term investments in ...