# Zero Growth Stock Price Calculator

Instructions: Use this calculator to compute the price of a zero growth stock, showing all the steps, by providing the value of the dividend paid ($$D$$), the discount rate per period ($$r$$):

Dividend per Period $$(D)$$ =
Discount rate per period $$(r)$$ =

## Stock Value Calculator

More about this zero-growth stock value calculator so you can better understand how to use this solver: The price of a stock depends on whether it gives dividends or not and whether the dividend value grows or not. Assuming a zero-growth stock, with a dividend of $$D$$ and a is discount rate of $$r$$, the price of the stock is computed sing the following formula:

$\text{Zero-Growth Stock Value} = \displaystyle \frac{D}{r}$

### Example: Zero-Growth Stock

Question: Find the value of a zero-growth stock which has a dividend of $3.56 per year, per share, and it has a discount rate of 3.4%. Solution: This is the information we have been provided with: • The dividend pay per period is $$D = 3.56$$, and the appropriate discount rate per period is $$r = 0.034$$. Therefore, the price of the corresponding zero-growth stock is : $\begin{array}{ccl} P & = & \displaystyle \sum_{n = 1}^{\infty} {\frac{D}{(1+r)^n}} \\\\ \\\\ & = & \displaystyle \frac{D}{1+r} + \frac{D}{(1+r)^2 } + ... \\\\ \\\\ & = & \displaystyle \frac{D}{r} \\\\ \\\\ & = & \displaystyle \frac{3.56}{0.034} \\\\ \\\\ & = & 104.71 \end{array}$ Therefore, price for the stock price with zero-growth, a dividend of $$D = 3.56$$ and a discount rate of $$r = 0.034$$ is$$$104.71$$.

### Corporate Finance Calculators

You can use also a traditional stock price calculator .