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Invesco Municipal Trust (VKQ)

Company Dividend Discount ModelIndustry: Asset ManagementSector: Financial Services

Valuation Snapshot

Stable Growth$5.10 - $6.81$5.99
Multi-Stage$10.90 - $11.99$11.44
Blended Fair Value$8.71
Current Price$10.07
Upside-13.50%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2025202420232022202120202019201820172016
DPS-6.31%-6.44%0.420.420.500.620.600.580.630.720.780.82
YoY Growth---0.80%-16.34%-19.57%3.45%4.54%-8.00%-12.68%-7.47%-4.85%0.63%
Dividend Yield--4.14%4.40%5.30%5.28%4.64%4.58%5.27%6.08%6.15%6.27%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)67.02
(-) Cash Dividends Paid (M)46.29
(=) Cash Retained (M)20.73
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)13.408.385.03
Cash Retained (M)20.7320.7320.73
(-) Cash Required (M)-13.40-8.38-5.03
(=) Excess Retained (M)7.3312.3615.71
(/) Shares Outstanding (M)55.3555.3555.35
(=) Excess Retained per Share0.130.220.28
LTM Dividend per Share0.840.840.84
(+) Excess Retained per Share0.130.220.28
(=) Adjusted Dividend0.971.061.12
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate-8.31%-7.31%-6.31%
Fair Value$5.10$5.99$6.81
Upside / Downside-49.33%-40.56%-32.36%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)67.0262.1257.5853.3749.4745.8647.23
Payout Ratio69.07%73.25%77.44%81.63%85.81%90.00%92.50%
Projected Dividends (M)46.2945.5144.5943.5742.4541.2743.69

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate-8.31%-7.31%-6.31%
Year 1 PV (M)41.2641.7142.16
Year 2 PV (M)36.6637.4638.28
Year 3 PV (M)32.4833.5534.65
Year 4 PV (M)28.6929.9731.28
Year 5 PV (M)25.2926.7028.17
PV of Terminal Value (M)439.08463.55489.11
Equity Value (M)603.47632.95663.65
Shares Outstanding (M)55.3555.3555.35
Fair Value$10.90$11.44$11.99
Upside / Downside8.27%13.56%19.07%

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