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East West Bancorp, Inc. (EWBC)

Company Dividend Discount ModelIndustry: Banks - DiversifiedSector: Financial Services

Valuation Snapshot

Stable Growth$213.65 - $570.33$327.32
Multi-Stage$146.26 - $159.79$152.90
Blended Fair Value$240.11
Current Price$106.45
Upside125.56%
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 Rate9.08%9.08%9.08%
Growth Rate5.50%6.50%7.50%
Fair Value$213.65$327.32$570.33
Upside / Downside100.70%207.49%435.77%

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 Rate9.08%9.08%9.08%
Growth Rate5.50%6.50%7.50%
Year 1 PV (M)473.33477.82482.30
Year 2 PV (M)608.97620.57632.28
Year 3 PV (M)735.20756.30777.81
Year 4 PV (M)852.48885.27918.99
Year 5 PV (M)961.281,007.711,055.92
PV of Terminal Value (M)16,737.1817,545.6018,384.95
Equity Value (M)20,368.4521,293.2722,252.25
Shares Outstanding (M)139.26139.26139.26
Fair Value$146.26$152.90$159.79
Upside / Downside37.40%43.63%50.10%

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