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East West Bancorp, Inc. (EWBC)

Company Dividend Discount ModelIndustry: Banks - DiversifiedSector: Financial Services

Valuation Snapshot

Stable Growth$212.58 - $563.91$325.05
Multi-Stage$145.79 - $159.27$152.41
Blended Fair Value$238.73
Current Price$106.45
Upside124.27%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS14.74%11.53%2.221.971.641.361.141.110.900.840.830.83
YoY Growth--12.36%20.22%20.99%19.30%2.01%23.11%7.85%0.86%0.16%11.60%
Dividend Yield--2.47%2.53%2.95%1.72%1.54%4.33%1.81%1.34%1.61%2.56%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)1,262.03
(-) Cash Dividends Paid (M)327.79
(=) Cash Retained (M)934.25
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)252.41157.7594.65
Cash Retained (M)934.25934.25934.25
(-) Cash Required (M)-252.41-157.75-94.65
(=) Excess Retained (M)681.84776.49839.59
(/) Shares Outstanding (M)139.26139.26139.26
(=) Excess Retained per Share4.905.586.03
LTM Dividend per Share2.352.352.35
(+) Excess Retained per Share4.905.586.03
(=) Adjusted Dividend7.257.938.38
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Fair Value$212.58$325.05$563.91
Upside / Downside99.70%205.36%429.74%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)1,262.031,344.061,431.431,524.471,623.561,729.091,780.97
Payout Ratio25.97%38.78%51.58%64.39%77.19%90.00%92.50%
Projected Dividends (M)327.79521.20738.38981.591,253.301,556.181,647.39

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Year 1 PV (M)473.25477.74482.23
Year 2 PV (M)608.77620.37632.07
Year 3 PV (M)734.84755.93777.42
Year 4 PV (M)851.92884.68918.38
Year 5 PV (M)960.491,006.881,055.05
PV of Terminal Value (M)16,674.0217,479.3818,315.56
Equity Value (M)20,303.2921,224.9822,180.71
Shares Outstanding (M)139.26139.26139.26
Fair Value$145.79$152.41$159.27
Upside / Downside36.96%43.17%49.62%

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