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Middlesex Water Company (MSEX)

Company Dividend Discount ModelIndustry: Regulated WaterSector: Utilities

Valuation Snapshot

Stable Growth$53.68 - $135.57$80.83
Multi-Stage$39.53 - $43.12$41.29
Blended Fair Value$61.06
Current Price$54.12
Upside12.83%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS7.69%6.71%1.301.251.161.081.010.900.830.780.730.70
YoY Growth--4.31%7.84%7.42%6.57%12.45%8.27%6.63%6.58%4.65%2.63%
Dividend Yield--2.03%2.43%1.48%1.02%1.28%1.49%1.51%2.12%1.97%2.26%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)43.02
(-) Cash Dividends Paid (M)24.39
(=) Cash Retained (M)18.63
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)8.605.383.23
Cash Retained (M)18.6318.6318.63
(-) Cash Required (M)-8.60-5.38-3.23
(=) Excess Retained (M)10.0313.2515.40
(/) Shares Outstanding (M)18.0118.0118.01
(=) Excess Retained per Share0.560.740.86
LTM Dividend per Share1.351.351.35
(+) Excess Retained per Share0.560.740.86
(=) Adjusted Dividend1.912.092.21
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.35%6.35%7.35%
Fair Value$53.68$80.83$135.57
Upside / Downside-0.81%49.36%150.49%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)43.0245.7548.6551.7455.0358.5260.28
Payout Ratio56.69%63.35%70.02%76.68%83.34%90.00%92.50%
Projected Dividends (M)24.3928.9834.0739.6845.8652.6755.76

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.35%6.35%7.35%
Year 1 PV (M)26.3226.5726.82
Year 2 PV (M)28.0928.6229.16
Year 3 PV (M)29.7030.5531.42
Year 4 PV (M)31.1732.3733.61
Year 5 PV (M)32.5134.0835.71
PV of Terminal Value (M)564.31591.60619.94
Equity Value (M)712.09743.80776.67
Shares Outstanding (M)18.0118.0118.01
Fair Value$39.53$41.29$43.12
Upside / Downside-26.96%-23.70%-20.33%

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