OMF Price Forecast Based on Dividend Discount Model

For dividend yielding stocks, the Dividend Discount Model (DDM) is a common valuation tool; it attempts to extrapolate a fair share price based primarily on the dividend the stock provides relative to a number of other quantiative aspects of its business. As for OMF, the DDM model, as implemented by StockNews, implies a positive return of 79.77% relative to its current price. Some interesting points we thought investors may wish to consider regarding the dividend discount model forecast for OneMain Holdings Inc are:

• If we compare the valuation opportunity a dividend discount model provides relative to other dividend stocks in the Financial Services sector, the expected return of 79.77%, based on the stock's current share price and target price based on a dividend discount model, is greater than 89.55% of the DDM-forecasted return of its its sector peers.
• Compared to all dividend issuing stocks in our set, OMF has a discount rate lower than 89.55% of them (a lower discount rate is associated with lower risk).
• A stock's beta generally indicates its volatility relative to the broader equity market; for OneMain Holdings Inc, its beta is lower than 5.06% of dividend issuing stocks we observed.
• In comparison to its fellow dividend issuing stocks in the Financial Services sector, OMF's equity discount rate is less than 7.89% of those stocks.

OMF Dividends vs. Peers