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Texas Roadhouse, Inc. (TXRH)

Company Dividend Discount ModelIndustry: RestaurantsSector: Consumer Cyclical

Valuation Snapshot

Stable Growth$153.61 - $407.48$234.88
Multi-Stage$107.10 - $116.91$111.92
Blended Fair Value$173.40
Current Price$166.15
Upside4.36%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS9.73%17.92%2.442.211.861.250.371.531.030.870.780.69
YoY Growth--10.65%18.56%48.39%234.78%-75.59%49.33%17.88%11.72%12.73%47.37%
Dividend Yield--1.45%1.45%1.75%1.47%0.39%3.72%1.68%1.53%1.77%1.59%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)436.75
(-) Cash Dividends Paid (M)176.03
(=) Cash Retained (M)260.73
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)87.3554.5932.76
Cash Retained (M)260.73260.73260.73
(-) Cash Required (M)-87.35-54.59-32.76
(=) Excess Retained (M)173.38206.13227.97
(/) Shares Outstanding (M)66.7066.7066.70
(=) Excess Retained per Share2.603.093.42
LTM Dividend per Share2.642.642.64
(+) Excess Retained per Share2.603.093.42
(=) Adjusted Dividend5.245.736.06
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Fair Value$153.61$234.88$407.48
Upside / Downside-7.55%41.37%145.25%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)436.75465.14495.38527.57561.87598.39616.34
Payout Ratio40.30%50.24%60.18%70.12%80.06%90.00%92.50%
Projected Dividends (M)176.03233.70298.13369.94449.83538.55570.11

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Year 1 PV (M)212.20214.21216.22
Year 2 PV (M)245.80250.48255.20
Year 3 PV (M)276.94284.89293.00
Year 4 PV (M)305.77317.53329.63
Year 5 PV (M)332.40348.45365.12
PV of Terminal Value (M)5,770.396,049.106,338.48
Equity Value (M)7,143.497,464.667,797.64
Shares Outstanding (M)66.7066.7066.70
Fair Value$107.10$111.92$116.91
Upside / Downside-35.54%-32.64%-29.63%

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