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Employers Holdings, Inc. (EIG)

Company Dividend Discount ModelIndustry: Insurance - SpecialtySector: Financial Services

Valuation Snapshot

Stable Growth$20.65 - $30.61$25.41
Multi-Stage$31.80 - $34.84$33.29
Blended Fair Value$29.35
Current Price$42.48
Upside-30.91%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS1.38%14.92%1.231.213.681.181.241.151.090.800.470.31
YoY Growth--2.02%-67.11%211.38%-4.92%7.77%5.99%35.53%71.30%49.35%2.12%
Dividend Yield--2.44%2.70%8.82%2.88%2.88%2.84%2.67%1.98%1.23%1.11%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)62.50
(-) Cash Dividends Paid (M)30.30
(=) Cash Retained (M)32.20
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)12.507.814.69
Cash Retained (M)32.2032.2032.20
(-) Cash Required (M)-12.50-7.81-4.69
(=) Excess Retained (M)19.7024.3927.51
(/) Shares Outstanding (M)24.5624.5624.56
(=) Excess Retained per Share0.800.991.12
LTM Dividend per Share1.231.231.23
(+) Excess Retained per Share0.800.991.12
(=) Adjusted Dividend2.042.232.35
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate-0.69%0.31%1.31%
Fair Value$20.65$25.41$30.61
Upside / Downside-51.39%-40.19%-27.95%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)62.5062.6962.8863.0863.2763.4665.37
Payout Ratio48.48%56.78%65.09%73.39%81.70%90.00%92.50%
Projected Dividends (M)30.3035.6040.9346.2951.6957.1260.46

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate-0.69%0.31%1.31%
Year 1 PV (M)32.3032.6332.96
Year 2 PV (M)33.7134.3935.08
Year 3 PV (M)34.5935.6536.73
Year 4 PV (M)35.0536.4937.96
Year 5 PV (M)35.1536.9638.83
PV of Terminal Value (M)610.20641.55674.17
Equity Value (M)781.01817.66855.73
Shares Outstanding (M)24.5624.5624.56
Fair Value$31.80$33.29$34.84
Upside / Downside-25.14%-21.63%-17.98%

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