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Marriott Vacations Worldwide Corporation (VAC)

Company Dividend Discount ModelIndustry: Gambling, Resorts & CasinosSector: Consumer Cyclical

Valuation Snapshot

Stable Growth$66.51 - $124.87$90.24
Multi-Stage$68.08 - $74.24$71.10
Blended Fair Value$80.67
Current Price$66.56
Upside21.20%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS5.73%29.32%2.662.642.460.571.122.021.270.950.850.59
YoY Growth--0.94%7.07%330.43%-48.89%-44.44%58.82%34.21%11.76%42.90%190.90%
Dividend Yield--4.15%2.46%1.83%0.36%0.64%3.63%1.31%0.71%0.85%0.90%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)173.00
(-) Cash Dividends Paid (M)136.00
(=) Cash Retained (M)37.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)34.6021.6312.98
Cash Retained (M)37.0037.0037.00
(-) Cash Required (M)-34.60-21.63-12.98
(=) Excess Retained (M)2.4015.3824.03
(/) Shares Outstanding (M)40.1840.1840.18
(=) Excess Retained per Share0.060.380.60
LTM Dividend per Share3.393.393.39
(+) Excess Retained per Share0.060.380.60
(=) Adjusted Dividend3.443.773.98
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate3.73%4.73%5.73%
Fair Value$66.51$90.24$124.87
Upside / Downside-0.07%35.58%87.61%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)173.00181.18189.74198.70208.09217.93224.46
Payout Ratio78.61%80.89%83.17%85.45%87.72%90.00%92.50%
Projected Dividends (M)136.00146.55157.80169.78182.54196.13207.63

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate3.73%4.73%5.73%
Year 1 PV (M)133.05134.33135.61
Year 2 PV (M)130.06132.58135.12
Year 3 PV (M)127.04130.75134.53
Year 4 PV (M)124.00128.85133.85
Year 5 PV (M)120.96126.90133.08
PV of Terminal Value (M)2,099.822,203.012,310.22
Equity Value (M)2,734.922,856.422,982.41
Shares Outstanding (M)40.1840.1840.18
Fair Value$68.08$71.10$74.24
Upside / Downside2.28%6.82%11.53%

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