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Reaves Utility Income Fund (UTG)

Company Dividend Discount ModelIndustry: Asset Management - IncomeSector: Financial Services

Valuation Snapshot

Stable Growth$97.35 - $150.98$122.17
Multi-Stage$133.65 - $146.34$139.88
Blended Fair Value$131.02
Current Price$32.78
Upside299.71%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS12.61%14.20%2.282.071.931.591.331.261.231.260.790.66
YoY Growth--10.43%7.04%21.43%19.26%5.78%2.24%-1.87%59.71%19.15%9.16%
Dividend Yield--7.03%8.42%7.00%4.67%4.24%3.40%4.06%4.05%2.62%2.23%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)790.92
(-) Cash Dividends Paid (M)341.71
(=) Cash Retained (M)449.21
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)158.1898.8759.32
Cash Retained (M)449.21449.21449.21
(-) Cash Required (M)-158.18-98.87-59.32
(=) Excess Retained (M)291.02350.34389.89
(/) Shares Outstanding (M)78.4878.4878.48
(=) Excess Retained per Share3.714.464.97
LTM Dividend per Share4.354.354.35
(+) Excess Retained per Share3.714.464.97
(=) Adjusted Dividend8.068.829.32
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate0.75%1.75%2.75%
Fair Value$97.35$122.17$150.98
Upside / Downside196.97%272.71%360.59%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)790.92804.79818.91833.27847.88862.75888.63
Payout Ratio43.20%52.56%61.92%71.28%80.64%90.00%92.50%
Projected Dividends (M)341.71423.03507.09593.97683.74776.48821.99

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate0.75%1.75%2.75%
Year 1 PV (M)383.94387.75391.56
Year 2 PV (M)417.71426.04434.46
Year 3 PV (M)444.06457.42471.04
Year 4 PV (M)463.95482.64501.89
Year 5 PV (M)478.19502.39527.57
PV of Terminal Value (M)8,301.338,721.559,158.62
Equity Value (M)10,489.1710,977.7911,485.13
Shares Outstanding (M)78.4878.4878.48
Fair Value$133.65$139.88$146.34
Upside / Downside307.72%326.71%346.43%

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