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National Bank of Canada (NA-PC.TO)

Company Dividend Discount ModelIndustry: Banks - DiversifiedSector: Financial Services

Valuation Snapshot

Stable Growth$565.91 - $2,087.40$1,729.93
Multi-Stage$265.28 - $290.06$277.44
Blended Fair Value$1,003.69
Current Price$26.54
Upside3,681.79%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2025202420232022202120202019201820172016
DPS8.47%10.53%5.104.293.933.462.883.402.592.402.211.57
YoY Growth--19.02%9.12%13.43%20.35%-15.31%31.05%8.06%8.51%41.00%-16.32%
Dividend Yield--19.22%16.19%15.37%13.37%11.35%13.56%11.84%10.57%8.70%6.29%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)4,017.00
(-) Cash Dividends Paid (M)1,952.00
(=) Cash Retained (M)2,065.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)803.40502.13301.28
Cash Retained (M)2,065.002,065.002,065.00
(-) Cash Required (M)-803.40-502.13-301.28
(=) Excess Retained (M)1,261.601,562.881,763.73
(/) Shares Outstanding (M)382.72382.72382.72
(=) Excess Retained per Share3.304.084.61
LTM Dividend per Share5.105.105.10
(+) Excess Retained per Share3.304.084.61
(=) Adjusted Dividend8.409.189.71
WACC / Discount Rate7.07%7.07%7.07%
Growth Rate5.50%6.50%7.50%
Fair Value$565.91$1,729.93$2,087.40
Upside / Downside2,032.27%6,418.20%7,765.12%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)4,017.004,278.114,556.184,852.335,167.745,503.645,668.75
Payout Ratio48.59%56.87%65.16%73.44%81.72%90.00%92.50%
Projected Dividends (M)1,952.002,433.162,968.633,563.434,223.014,953.275,243.59

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate7.07%7.07%7.07%
Growth Rate5.50%6.50%7.50%
Year 1 PV (M)2,251.262,272.592,293.93
Year 2 PV (M)2,541.342,589.752,638.61
Year 3 PV (M)2,822.472,903.492,986.05
Year 4 PV (M)3,094.833,213.853,336.27
Year 5 PV (M)3,358.623,520.843,689.27
PV of Terminal Value (M)87,456.9191,681.1196,066.99
Equity Value (M)101,525.43106,181.64111,011.12
Shares Outstanding (M)382.72382.72382.72
Fair Value$265.28$277.44$290.06
Upside / Downside899.54%945.38%992.92%

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