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Truist Financial Corporation (TFC)

Company Dividend Discount ModelIndustry: Banks - RegionalSector: Financial Services

Valuation Snapshot

Stable Growth$90.83 - $242.47$139.15
Multi-Stage$64.14 - $69.97$67.00
Blended Fair Value$103.08
Current Price$45.72
Upside125.46%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS16.17%15.32%2.102.102.021.891.840.990.910.760.700.60
YoY Growth--0.00%4.29%6.88%2.52%85.18%8.72%19.80%8.65%17.24%18.47%
Dividend Yield--5.11%5.48%5.91%3.33%3.16%3.22%1.90%1.47%1.57%1.80%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)5,074.00
(-) Cash Dividends Paid (M)2,699.00
(=) Cash Retained (M)2,375.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)1,014.80634.25380.55
Cash Retained (M)2,375.002,375.002,375.00
(-) Cash Required (M)-1,014.80-634.25-380.55
(=) Excess Retained (M)1,360.201,740.751,994.45
(/) Shares Outstanding (M)1,317.011,317.011,317.01
(=) Excess Retained per Share1.031.321.51
LTM Dividend per Share2.052.052.05
(+) Excess Retained per Share1.031.321.51
(=) Adjusted Dividend3.083.373.56
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate5.50%6.50%7.50%
Fair Value$90.83$139.15$242.47
Upside / Downside98.66%204.36%430.33%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)5,074.005,403.815,755.066,129.146,527.536,951.827,160.37
Payout Ratio53.19%60.55%67.92%75.28%82.64%90.00%92.50%
Projected Dividends (M)2,699.003,272.233,908.584,613.845,394.266,256.646,623.35

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate5.50%6.50%7.50%
Year 1 PV (M)2,971.682,999.853,028.02
Year 2 PV (M)3,223.553,284.953,346.93
Year 3 PV (M)3,455.693,554.893,655.98
Year 4 PV (M)3,669.123,810.233,955.36
Year 5 PV (M)3,864.824,051.504,245.31
PV of Terminal Value (M)67,291.8570,542.0873,916.69
Equity Value (M)84,476.7388,243.5092,148.29
Shares Outstanding (M)1,317.011,317.011,317.01
Fair Value$64.14$67.00$69.97
Upside / Downside40.29%46.55%53.04%

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