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1st Source Corporation (SRCE)

Company Dividend Discount ModelIndustry: Banks - RegionalSector: Financial Services

Valuation Snapshot

Stable Growth$131.23 - $318.48$195.09
Multi-Stage$96.17 - $105.09$100.55
Blended Fair Value$147.82
Current Price$61.56
Upside140.12%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS4.05%7.21%1.441.351.311.281.211.181.050.830.790.74
YoY Growth--7.02%3.03%2.43%5.29%2.56%12.98%25.72%5.23%7.12%2.74%
Dividend Yield--2.41%2.62%3.03%2.76%2.55%3.65%2.29%1.65%1.69%2.32%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)148.58
(-) Cash Dividends Paid (M)37.44
(=) Cash Retained (M)111.14
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)29.7218.5711.14
Cash Retained (M)111.14111.14111.14
(-) Cash Required (M)-29.72-18.57-11.14
(=) Excess Retained (M)81.4292.57100.00
(/) Shares Outstanding (M)24.5124.5124.51
(=) Excess Retained per Share3.323.784.08
LTM Dividend per Share1.531.531.53
(+) Excess Retained per Share3.323.784.08
(=) Adjusted Dividend4.855.305.61
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.21%6.21%7.21%
Fair Value$131.23$195.09$318.48
Upside / Downside113.18%216.91%417.35%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)148.58157.81167.61178.02189.07200.82206.84
Payout Ratio25.20%38.16%51.12%64.08%77.04%90.00%92.50%
Projected Dividends (M)37.4460.2285.68114.07145.66180.74191.33

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.21%6.21%7.21%
Year 1 PV (M)54.6855.2055.72
Year 2 PV (M)70.6471.9973.35
Year 3 PV (M)85.3987.8590.35
Year 4 PV (M)99.00102.82106.75
Year 5 PV (M)111.54116.94122.55
PV of Terminal Value (M)1,936.282,030.062,127.45
Equity Value (M)2,357.522,464.852,576.16
Shares Outstanding (M)24.5124.5124.51
Fair Value$96.17$100.55$105.09
Upside / Downside56.22%63.33%70.71%

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