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Northwestern Energy Group Inc (NWE)

Company Dividend Discount ModelIndustry: Diversified UtilitiesSector: Utilities

Valuation Snapshot

Stable Growth$51.07 - $92.51$68.33
Multi-Stage$54.75 - $59.73$57.19
Blended Fair Value$62.76
Current Price$58.61
Upside7.09%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS6.62%9.33%2.582.512.282.091.961.881.781.651.561.47
YoY Growth--2.95%9.99%9.01%6.76%4.54%5.43%7.83%5.75%6.34%38.51%
Dividend Yield--4.47%4.96%3.95%3.46%3.01%3.14%2.53%3.07%2.66%2.38%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)216.93
(-) Cash Dividends Paid (M)160.68
(=) Cash Retained (M)56.25
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)43.3927.1216.27
Cash Retained (M)56.2556.2556.25
(-) Cash Required (M)-43.39-27.12-16.27
(=) Excess Retained (M)12.8629.1339.98
(/) Shares Outstanding (M)61.3661.3661.36
(=) Excess Retained per Share0.210.470.65
LTM Dividend per Share2.622.622.62
(+) Excess Retained per Share0.210.470.65
(=) Adjusted Dividend2.833.093.27
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate3.37%4.37%5.37%
Fair Value$51.07$68.33$92.51
Upside / Downside-12.86%16.59%57.84%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)216.93226.41236.31246.65257.43268.69276.75
Payout Ratio74.07%77.26%80.44%83.63%86.81%90.00%92.50%
Projected Dividends (M)160.68174.92190.10206.27223.49241.82255.99

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate3.37%4.37%5.37%
Year 1 PV (M)158.80160.33161.87
Year 2 PV (M)156.67159.71162.79
Year 3 PV (M)154.32158.85163.46
Year 4 PV (M)151.80157.76163.89
Year 5 PV (M)149.11156.46164.10
PV of Terminal Value (M)2,588.532,716.172,848.81
Equity Value (M)3,359.223,509.283,664.91
Shares Outstanding (M)61.3661.3661.36
Fair Value$54.75$57.19$59.73
Upside / Downside-6.59%-2.41%1.91%

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