PAA 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 PAA, the dividend discount model StockNews created for the company implies a positive return of 110.02%. To help understand and contextualize the model's evaluation of PAA, investors may wish to consider are:

• Given its market cap of around 6 billion US dollars, its dividend yield of 8.14 is greater than 94.79% of its fellow stocks in the large market cap class.
• Plains All American Pipeline Lp's market cap of $6 billion US dollars puts it in the large-sized market cap class; here, it has a lower equity discount rate than 6.28% of stocks.
• A stock's beta generally indicates its volatility relative to the broader equity market; as for PAA, approximately 4.8% of US-listed dividend issuers had a higher beta, and thus may have greater price volatility.

PAA Dividends vs. Peers