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The Toro Company (TTC)

Company Dividend Discount ModelIndustry: Manufacturing - Tools & AccessoriesSector: Industrials

Valuation Snapshot

Stable Growth$77.11 - $204.55$117.91
Multi-Stage$54.07 - $59.01$56.49
Blended Fair Value$87.20
Current Price$72.97
Upside19.50%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS9.23%12.74%1.481.401.241.111.060.950.840.750.650.55
YoY Growth--5.36%12.89%11.83%4.37%12.03%13.06%12.24%14.98%18.62%23.31%
Dividend Yield--1.77%1.49%1.18%1.15%1.13%1.19%1.41%1.15%1.36%1.47%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)333.00
(-) Cash Dividends Paid (M)150.70
(=) Cash Retained (M)182.30
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)66.6041.6324.98
Cash Retained (M)182.30182.30182.30
(-) Cash Required (M)-66.60-41.63-24.98
(=) Excess Retained (M)115.70140.68157.33
(/) Shares Outstanding (M)101.30101.30101.30
(=) Excess Retained per Share1.141.391.55
LTM Dividend per Share1.491.491.49
(+) Excess Retained per Share1.141.391.55
(=) Adjusted Dividend2.632.883.04
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Fair Value$77.11$117.91$204.55
Upside / Downside5.67%61.59%180.33%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)333.00354.65377.70402.25428.39456.24469.93
Payout Ratio45.26%54.20%63.15%72.10%81.05%90.00%92.50%
Projected Dividends (M)150.70192.23238.53290.03347.22410.61434.68

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Year 1 PV (M)174.55176.20177.86
Year 2 PV (M)196.66200.40204.18
Year 3 PV (M)217.12223.35229.70
Year 4 PV (M)236.02245.09254.43
Year 5 PV (M)253.43265.68278.38
PV of Terminal Value (M)4,399.614,612.114,832.75
Equity Value (M)5,477.395,722.845,977.31
Shares Outstanding (M)101.30101.30101.30
Fair Value$54.07$56.49$59.01
Upside / Downside-25.90%-22.58%-19.14%

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