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Texas Community Bancshares, Inc. (TCBS)

Company Dividend Discount ModelIndustry: Banks - RegionalSector: Financial Services

Valuation Snapshot

Stable Growth$6.06 - $8.72$7.36
Multi-Stage$9.68 - $10.64$10.15
Blended Fair Value$8.76
Current Price$16.05
Upside-45.44%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR202420232022202120202019
DPS0.00%0.00%0.170.130.000.000.000.000.000.000.000.00
YoY Growth--36.96%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%
Dividend Yield--1.07%0.86%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)2.52
(-) Cash Dividends Paid (M)0.48
(=) Cash Retained (M)2.03
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)0.500.310.19
Cash Retained (M)2.032.032.03
(-) Cash Required (M)-0.50-0.31-0.19
(=) Excess Retained (M)1.531.721.85
(/) Shares Outstanding (M)2.942.942.94
(=) Excess Retained per Share0.520.590.63
LTM Dividend per Share0.160.160.16
(+) Excess Retained per Share0.520.590.63
(=) Adjusted Dividend0.690.750.79
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate-2.00%-1.00%0.00%
Fair Value$6.06$7.36$8.72
Upside / Downside-62.24%-54.15%-45.66%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)2.522.492.472.442.422.392.47
Payout Ratio19.22%33.38%47.53%61.69%75.84%90.00%92.50%
Projected Dividends (M)0.480.831.171.511.832.162.28

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate-2.00%-1.00%0.00%
Year 1 PV (M)0.750.760.77
Year 2 PV (M)0.970.991.01
Year 3 PV (M)1.131.161.20
Year 4 PV (M)1.241.291.35
Year 5 PV (M)1.331.391.47
PV of Terminal Value (M)23.0124.2125.45
Equity Value (M)28.4229.8131.24
Shares Outstanding (M)2.942.942.94
Fair Value$9.68$10.15$10.64
Upside / Downside-39.66%-36.73%-33.68%

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