Definitive Analysis
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Definitive Analysis

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Somnigroup International Inc (SGI)

Company Dividend Discount ModelIndustry: Household & Personal ProductsSector: Consumer Defensive

Valuation Snapshot

Stable Growth$10.22 - $14.47$12.32
Multi-Stage$15.64 - $17.15$16.38
Blended Fair Value$14.35
Current Price$84.33
Upside-82.98%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020162015201420132012
DPS0.00%0.00%0.460.390.350.310.000.000.000.000.000.00
YoY Growth--19.31%10.21%11.73%0.00%0.00%0.00%0.00%0.00%0.00%0.00%
Dividend Yield--0.77%0.70%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)315.20
(-) Cash Dividends Paid (M)118.50
(=) Cash Retained (M)196.70
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)63.0439.4023.64
Cash Retained (M)196.70196.70196.70
(-) Cash Required (M)-63.04-39.40-23.64
(=) Excess Retained (M)133.66157.30173.06
(/) Shares Outstanding (M)200.63200.63200.63
(=) Excess Retained per Share0.670.780.86
LTM Dividend per Share0.590.590.59
(+) Excess Retained per Share0.670.780.86
(=) Adjusted Dividend1.261.371.45
WACC / Discount Rate10.05%10.05%10.05%
Growth Rate-2.00%-1.00%0.00%
Fair Value$10.22$12.32$14.47
Upside / Downside-87.88%-85.39%-82.85%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)315.20312.05308.93305.84302.78299.75308.74
Payout Ratio37.60%48.08%58.56%69.04%79.52%90.00%92.50%
Projected Dividends (M)118.50150.02180.90211.14240.77269.78285.59

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate10.05%10.05%10.05%
Growth Rate-2.00%-1.00%0.00%
Year 1 PV (M)134.95136.32137.70
Year 2 PV (M)146.37149.38152.41
Year 3 PV (M)153.68158.43163.28
Year 4 PV (M)157.64164.17170.90
Year 5 PV (M)158.88167.16175.77
PV of Terminal Value (M)2,386.882,511.172,640.58
Equity Value (M)3,138.403,286.633,440.65
Shares Outstanding (M)200.63200.63200.63
Fair Value$15.64$16.38$17.15
Upside / Downside-81.45%-80.57%-79.66%

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