Estimating orowth rates It is often difficult to estimate the expected future dividend growth rate for use in estimating the cost of existing equity using the DCF or DG aporoach. In general, there are three available methods to generate such an estimate: - Carry forward a historical realized orowth rate, and apply it to the future. - Locate and apply an expected future orowth rate prepared and published by security analysts. - Use the retention orowth model. Suppose Grant is currently distributing 65.00 of its earnings in the form of cash dividends. It has also historically generated an average return on equity (ROE) of 10.00, Grant's estimated orowth rate is