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Sun Life Financial Inc. (SLF)

Company Dividend Discount ModelIndustry: Insurance - DiversifiedSector: Financial Services

Valuation Snapshot

Stable Growth$117.05 - $291.13$175.41
Multi-Stage$136.36 - $149.36$142.74
Blended Fair Value$159.07
Current Price$83.56
Upside90.37%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS8.28%8.27%3.432.482.922.501.872.302.142.021.881.61
YoY Growth--38.17%-15.02%17.02%33.77%-19.01%7.42%6.23%7.54%16.61%3.95%
Dividend Yield--4.16%3.40%4.63%3.58%2.94%5.11%4.10%3.81%3.86%3.84%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)3,094.00
(-) Cash Dividends Paid (M)2,029.00
(=) Cash Retained (M)1,065.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)618.80386.75232.05
Cash Retained (M)1,065.001,065.001,065.00
(-) Cash Required (M)-618.80-386.75-232.05
(=) Excess Retained (M)446.20678.25832.95
(/) Shares Outstanding (M)572.25572.25572.25
(=) Excess Retained per Share0.781.191.46
LTM Dividend per Share3.553.553.55
(+) Excess Retained per Share0.781.191.46
(=) Adjusted Dividend4.334.735.00
WACC / Discount Rate6.67%6.67%6.67%
Growth Rate2.87%3.87%4.87%
Fair Value$117.05$175.41$291.13
Upside / Downside40.08%109.92%248.41%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)3,094.003,213.793,338.233,467.473,601.733,741.183,853.42
Payout Ratio65.58%70.46%75.35%80.23%85.12%90.00%92.50%
Projected Dividends (M)2,029.002,264.532,515.262,782.003,065.643,367.063,564.41

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate6.67%6.67%6.67%
Growth Rate2.87%3.87%4.87%
Year 1 PV (M)2,102.432,122.862,143.30
Year 2 PV (M)2,168.042,210.402,253.16
Year 3 PV (M)2,226.312,291.872,358.70
Year 4 PV (M)2,277.682,367.542,460.04
Year 5 PV (M)2,322.552,437.652,557.27
PV of Terminal Value (M)66,933.1270,250.2273,697.54
Equity Value (M)78,030.1381,680.5485,470.02
Shares Outstanding (M)572.25572.25572.25
Fair Value$136.36$142.74$149.36
Upside / Downside63.18%70.82%78.74%

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