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Kaiser Aluminum Corporation (KALU)

Company Dividend Discount ModelIndustry: AluminumSector: Basic Materials

Valuation Snapshot

Stable Growth$118.60 - $283.68$175.47
Multi-Stage$92.61 - $100.94$96.70
Blended Fair Value$136.09
Current Price$77.16
Upside76.37%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS5.17%7.16%3.083.063.052.842.642.402.292.131.971.71
YoY Growth--0.60%0.60%7.28%7.60%10.15%4.51%7.71%8.02%15.30%10.63%
Dividend Yield--5.09%3.46%4.08%3.02%2.39%3.46%2.17%2.11%2.47%2.02%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)91.40
(-) Cash Dividends Paid (M)64.10
(=) Cash Retained (M)27.30
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)18.2811.436.86
Cash Retained (M)27.3027.3027.30
(-) Cash Required (M)-18.28-11.43-6.86
(=) Excess Retained (M)9.0215.8820.45
(/) Shares Outstanding (M)16.4516.4516.45
(=) Excess Retained per Share0.550.971.24
LTM Dividend per Share3.903.903.90
(+) Excess Retained per Share0.550.971.24
(=) Adjusted Dividend4.454.865.14
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.16%6.16%7.16%
Fair Value$118.60$175.47$283.68
Upside / Downside53.71%127.41%267.65%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)91.4097.03103.00109.34116.07123.22126.91
Payout Ratio70.13%74.11%78.08%82.05%86.03%90.00%92.50%
Projected Dividends (M)64.1071.9080.4289.7299.85110.90117.40

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.16%6.16%7.16%
Year 1 PV (M)65.2865.9166.53
Year 2 PV (M)66.3067.5768.85
Year 3 PV (M)67.1669.0971.06
Year 4 PV (M)67.8770.4873.18
Year 5 PV (M)68.4471.7575.20
PV of Terminal Value (M)1,188.031,245.611,305.39
Equity Value (M)1,523.081,590.411,660.20
Shares Outstanding (M)16.4516.4516.45
Fair Value$92.61$96.70$100.94
Upside / Downside20.02%25.32%30.82%

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