what does the gordon growth model tell you 
the gordon growth model attempts to calculate the fair value of a stock irrespective of the prevailing market conditions and takes into consideration the dividend payout factors and the market s expected returns 1 if the ggm value is higher than the stock s current market price then the stock is considered to be undervalued and should be bought conversely if the value is lower than the stock s current market price then the stock is considered to be overvalued and should be sold 