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Invesco Municipal Trust (VKQ)

Company Dividend Discount ModelIndustry: Asset ManagementSector: Financial Services

Valuation Snapshot

Stable Growth$5.11 - $6.82$5.99
Multi-Stage$10.93 - $12.03$11.47
Blended Fair Value$8.73
Current Price$10.07
Upside-13.30%
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 Rate9.08%9.08%9.08%
Growth Rate-8.31%-7.31%-6.31%
Fair Value$5.11$5.99$6.82
Upside / Downside-49.28%-40.49%-32.28%

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 Rate9.08%9.08%9.08%
Growth Rate-8.31%-7.31%-6.31%
Year 1 PV (M)41.2741.7242.17
Year 2 PV (M)36.6737.4838.29
Year 3 PV (M)32.4933.5734.67
Year 4 PV (M)28.7129.9931.30
Year 5 PV (M)25.3126.7228.20
PV of Terminal Value (M)440.75465.31490.96
Equity Value (M)605.21634.78665.58
Shares Outstanding (M)55.3555.3555.35
Fair Value$10.93$11.47$12.03
Upside / Downside8.59%13.89%19.42%

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