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Caribbean Utilities Company, Ltd. (CUP-U.TO)

Company Dividend Discount ModelIndustry: Regulated ElectricSector: Utilities

Valuation Snapshot

Stable Growth$17.58 - $33.71$24.05
Multi-Stage$29.37 - $32.24$30.78
Blended Fair Value$27.41
Current Price$13.31
Upside105.95%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS2.40%3.09%0.680.620.610.610.620.600.590.580.570.55
YoY Growth--9.07%2.48%-0.25%-2.06%3.13%1.51%2.91%1.72%4.04%8.88%
Dividend Yield--5.12%4.38%4.33%4.02%4.14%4.23%3.92%4.26%4.22%5.03%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)45.48
(-) Cash Dividends Paid (M)29.18
(=) Cash Retained (M)16.30
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)9.105.683.41
Cash Retained (M)16.3016.3016.30
(-) Cash Required (M)-9.10-5.68-3.41
(=) Excess Retained (M)7.2010.6212.89
(/) Shares Outstanding (M)40.3140.3140.31
(=) Excess Retained per Share0.180.260.32
LTM Dividend per Share0.720.720.72
(+) Excess Retained per Share0.180.260.32
(=) Adjusted Dividend0.900.991.04
WACC / Discount Rate6.28%6.28%6.28%
Growth Rate1.09%2.09%3.09%
Fair Value$17.58$24.05$33.71
Upside / Downside32.06%80.67%153.30%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)45.4846.4347.4048.3949.4050.4351.94
Payout Ratio64.16%69.33%74.50%79.66%84.83%90.00%92.50%
Projected Dividends (M)29.1832.1935.3138.5541.9045.3948.05

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate6.28%6.28%6.28%
Growth Rate1.09%2.09%3.09%
Year 1 PV (M)29.9930.2930.58
Year 2 PV (M)30.6531.2631.87
Year 3 PV (M)31.1832.1133.06
Year 4 PV (M)31.5832.8434.15
Year 5 PV (M)31.8633.4735.14
PV of Terminal Value (M)1,028.681,080.581,134.55
Equity Value (M)1,183.931,240.551,299.36
Shares Outstanding (M)40.3140.3140.31
Fair Value$29.37$30.78$32.24
Upside / Downside120.68%131.23%142.19%

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