There are two main approaches to the problem of forecasting dividends:
First, we can assign the entire stream of expected future dividends to one of several stylized growth patterns.
Second, we can forecast a finite number of dividends individually up to a terminal point, valuing the remaining dividends by assigning them to a stylized growth pattern, or forecasting share price as of the terminal point of our dividend forecasts.
The first forecasting approach leads to the Gordon growth model and multistage dividend discount models, the second forecasting approach lends itself to spreadsheet modeling.
