select two competing publicly listed companies I choose the Google and Yahoo

B. Estimate intrinsic value of a stock using Dividend Discount Model (DDM):

Now determine the estimated dividends of the firm next year and the growth rate. Refer to the company’s financial statements. For dividends, check how much dividend the firm paid in the last year (Do), then estimate the growth rate (g) of dividend and/or free cash flow. Also estimate the growth rate by using the formula g=ROE(1-payout ratio)compare the growth rates and determine which growth rate is reasonable. If the growth rate is super normal/high, then make assumption how long this super normal growth will last before returning to normal/stable growth. Use constant or non-constant growth Dividend Discount Model (DDM) to calculate the intrinsic value of a share of stock.Financial statements are available at finance.yahoo.com website.

What do YOU think ?
While we're happy to HELP we won't do all the work for you.
Show us what you have done and where you are having problems..

I just don't know how to start, I already pick my company which is Google and Yahoo but I don't know how to determine the dividends of the firm next year and the growth rate

select two competing publicly listed companies I choose the Google and Yahoo

B. Estimate intrinsic value of a stock using Dividend Discount Model (DDM):

Now determine the estimated dividends of the firm next year and the growth rate. Refer to the company’s financial statements. For dividends, check how much dividend the firm paid in the last year (Do), then estimate the growth rate (g) of dividend and/or free cash flow. Also estimate the growth rate by using the formula g=ROE(1-payout ratio)compare the growth rates and determine which growth rate is reasonable. If the growth rate is super normal/high, then make assumption how long this super normal growth will last before returning to normal/stable growth. Use constant or non-constant growth Dividend Discount Model (DDM) to calculate the intrinsic value of a share of stock.Financial statements are available at finance.yahoo.com website.