The value of a stock is the present value of all future dividends. This is sometimes called the Gordon Growth model. This model assumes that dividends increase at a constant rate. In the real world that may not be right. In addition, there is no way to know what the long term rate of the dividend growth will be.
One way, is to look at the current dividend rate and the dividend rate a while back. Say 10 years. You can them compute the annualized dividend rate.
It seems to me a better approach, would be to look at the annual dividend rate, say for 10 years and compute a exponential function for the dividend history. This function would be computed using a least squares approach possible giving more weight to recent dividends.
Would it be better to use the second approach over the first approach in computing the rate of growth in the dividend?