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Encore Wire Corporation (WIRE)

Company Dividend Discount ModelIndustry: Electrical Equipment & PartsSector: Industrials

Valuation Snapshot

Stable Growth$444.84 - $1,180.03$680.20
Multi-Stage$296.01 - $323.88$309.69
Blended Fair Value$494.95
Current Price$267.40
Upside85.10%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2023202220212020201920182017201620152014
DPS-3.78%-1.82%0.080.090.100.100.100.100.100.100.100.10
YoY Growth---11.11%-5.21%-1.03%-1.37%0.30%0.42%0.30%-0.06%0.00%0.18%
Dividend Yield--0.03%0.05%0.09%0.15%0.24%0.17%0.18%0.22%0.26%0.26%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)316.19
(-) Cash Dividends Paid (M)1.32
(=) Cash Retained (M)314.87
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)63.2439.5223.71
Cash Retained (M)314.87314.87314.87
(-) Cash Required (M)-63.24-39.52-23.71
(=) Excess Retained (M)251.63275.34291.15
(/) Shares Outstanding (M)16.6716.6716.67
(=) Excess Retained per Share15.0916.5117.46
LTM Dividend per Share0.080.080.08
(+) Excess Retained per Share15.0916.5117.46
(=) Adjusted Dividend15.1716.5917.54
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Fair Value$444.84$680.20$1,180.03
Upside / Downside66.36%154.38%341.30%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)316.19336.75358.63381.95406.77433.21446.21
Payout Ratio0.42%18.33%36.25%54.17%72.08%90.00%92.50%
Projected Dividends (M)1.3261.74130.01206.89293.22389.89412.74

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Year 1 PV (M)56.0656.5957.12
Year 2 PV (M)107.19109.23111.29
Year 3 PV (M)154.88159.33163.86
Year 4 PV (M)199.31206.98214.86
Year 5 PV (M)240.64252.27264.33
PV of Terminal Value (M)4,177.554,379.334,588.83
Equity Value (M)4,935.645,163.725,400.30
Shares Outstanding (M)16.6716.6716.67
Fair Value$296.01$309.69$323.88
Upside / Downside10.70%15.82%21.12%

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