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Iridium Communications Inc. (IRDM)

Company Dividend Discount ModelIndustry: Telecommunications ServicesSector: Communication Services

Valuation Snapshot

Stable Growth$25.71 - $65.04$38.74
Multi-Stage$18.76 - $20.47$19.60
Blended Fair Value$29.17
Current Price$17.46
Upside67.06%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS0.00%0.00%0.590.590.000.000.000.000.000.000.000.00
YoY Growth---0.05%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%
Dividend Yield--2.15%2.26%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)125.85
(-) Cash Dividends Paid (M)62.50
(=) Cash Retained (M)63.35
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)25.1715.739.44
Cash Retained (M)63.3563.3563.35
(-) Cash Required (M)-25.17-15.73-9.44
(=) Excess Retained (M)38.1847.6253.91
(/) Shares Outstanding (M)110.18110.18110.18
(=) Excess Retained per Share0.350.430.49
LTM Dividend per Share0.570.570.57
(+) Excess Retained per Share0.350.430.49
(=) Adjusted Dividend0.911.001.06
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.35%6.35%7.35%
Fair Value$25.71$38.74$65.04
Upside / Downside47.27%121.86%272.49%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)125.85133.84142.35151.39161.01171.24176.38
Payout Ratio49.66%57.73%65.80%73.87%81.93%90.00%92.50%
Projected Dividends (M)62.5077.2793.66111.83131.92154.12163.15

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.35%6.35%7.35%
Year 1 PV (M)70.1670.8371.49
Year 2 PV (M)77.2278.6980.18
Year 3 PV (M)83.7186.1288.57
Year 4 PV (M)89.6793.1296.67
Year 5 PV (M)95.1299.72104.50
PV of Terminal Value (M)1,651.241,731.101,814.03
Equity Value (M)2,067.112,159.582,255.44
Shares Outstanding (M)110.18110.18110.18
Fair Value$18.76$19.60$20.47
Upside / Downside7.45%12.26%17.24%

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