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Bath & Body Works, Inc. (BBWI)

Company Dividend Discount ModelIndustry: Specialty RetailSector: Consumer Cyclical

Valuation Snapshot

Stable Growth$15.82 - $21.46$18.70
Multi-Stage$30.15 - $33.24$31.66
Blended Fair Value$25.18
Current Price$24.48
Upside2.86%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2025202420232022202120202019201820172016
DPS-11.82%-12.73%0.830.850.870.560.391.553.113.215.935.48
YoY Growth---2.75%-2.15%55.00%44.58%-75.00%-50.15%-2.92%-45.90%8.28%69.46%
Dividend Yield--2.65%1.85%2.48%1.06%0.73%16.01%14.87%11.56%13.90%8.66%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)699.00
(-) Cash Dividends Paid (M)169.00
(=) Cash Retained (M)530.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)139.8087.3852.43
Cash Retained (M)530.00530.00530.00
(-) Cash Required (M)-139.80-87.38-52.43
(=) Excess Retained (M)390.20442.63477.58
(/) Shares Outstanding (M)213.81213.81213.81
(=) Excess Retained per Share1.832.072.23
LTM Dividend per Share0.790.790.79
(+) Excess Retained per Share1.832.072.23
(=) Adjusted Dividend2.622.863.02
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate-6.40%-5.40%-4.40%
Fair Value$15.82$18.70$21.46
Upside / Downside-35.38%-23.63%-12.36%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)699.00661.29625.61591.85559.92529.71545.60
Payout Ratio24.18%37.34%50.51%63.67%76.84%90.00%92.50%
Projected Dividends (M)169.00246.94315.97376.84430.22476.74504.68

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate-6.40%-5.40%-4.40%
Year 1 PV (M)223.99226.38228.77
Year 2 PV (M)259.97265.56271.20
Year 3 PV (M)281.24290.35299.65
Year 4 PV (M)291.24303.88316.94
Year 5 PV (M)292.74308.71325.38
PV of Terminal Value (M)5,096.945,375.085,665.23
Equity Value (M)6,446.116,769.967,107.17
Shares Outstanding (M)213.81213.81213.81
Fair Value$30.15$31.66$33.24
Upside / Downside23.16%29.35%35.79%

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