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Western Asset Emerging Markets Debt Fund Inc. (EMD)

Company Dividend Discount ModelIndustry: Asset ManagementSector: Financial Services

Valuation Snapshot

Stable Growth$18.25 - $26.26$22.16
Multi-Stage$31.62 - $34.60$33.08
Blended Fair Value$27.62
Current Price$10.05
Upside174.84%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS-4.01%3.11%1.020.941.051.131.221.251.251.260.670.69
YoY Growth--8.32%-10.02%-7.11%-8.09%-2.08%0.00%-0.83%89.44%-3.82%-7.75%
Dividend Yield--10.59%10.22%11.48%8.79%8.81%8.76%10.18%8.11%4.53%7.11%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)150.72
(-) Cash Dividends Paid (M)117.81
(=) Cash Retained (M)32.91
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)30.1418.8411.30
Cash Retained (M)32.9132.9132.91
(-) Cash Required (M)-30.14-18.84-11.30
(=) Excess Retained (M)2.7614.0721.60
(/) Shares Outstanding (M)58.2958.2958.29
(=) Excess Retained per Share0.050.240.37
LTM Dividend per Share2.022.022.02
(+) Excess Retained per Share0.050.240.37
(=) Adjusted Dividend2.072.262.39
WACC / Discount Rate9.11%9.11%9.11%
Growth Rate-2.00%-1.00%0.00%
Fair Value$18.25$22.16$26.26
Upside / Downside81.62%120.52%161.34%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)150.72149.21147.72146.24144.78143.33147.63
Payout Ratio78.17%80.53%82.90%85.27%87.63%90.00%92.50%
Projected Dividends (M)117.81120.17122.46124.70126.88129.00136.56

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.11%9.11%9.11%
Growth Rate-2.00%-1.00%0.00%
Year 1 PV (M)109.02110.14111.25
Year 2 PV (M)100.80102.87104.96
Year 3 PV (M)93.1396.0198.94
Year 4 PV (M)85.9789.5393.20
Year 5 PV (M)79.3083.4387.73
PV of Terminal Value (M)1,374.641,446.231,520.76
Equity Value (M)1,842.871,928.202,016.84
Shares Outstanding (M)58.2958.2958.29
Fair Value$31.62$33.08$34.60
Upside / Downside214.60%229.17%244.30%

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