AuthorTopic: Supernormal Growth DDM
@2014-12-16 19:05:18
Has anyone solved the example in the reading ( Study Session 14, Reading 56&57, Page 211)

I have a bit of problem of understanding why these guys are taking D4 for computation and why not D5? As they mention themselves in the explanation that most finance textbooks would use D5 instead of D4 ....and they also mention in the notes that both ways you end up getting same answer but I am not getting the same answer when I use D5 to solve the problem.

I guess I have a problem understanding where to exactly apply DDM model in case of supernormal growth rates. Can anyone explain me?

CFA Discussion Topic: Supernormal Growth DDM

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Colin Sampaleanu

Colin Sampaleanu