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MFS Investment Grade Municipal Trust (CXH)

Company Dividend Discount ModelIndustry: Asset ManagementSector: Financial Services

Valuation Snapshot

Stable Growth$2.06 - $2.71$2.40
Multi-Stage$4.67 - $5.14$4.90
Blended Fair Value$3.65
Current Price$7.58
Upside-51.87%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS-8.86%-8.67%0.300.310.460.510.510.480.530.650.690.72
YoY Growth---1.24%-33.12%-10.41%0.14%6.10%-9.53%-18.28%-6.05%-4.15%-3.51%
Dividend Yield--3.67%4.21%6.27%5.18%5.31%4.88%6.04%6.71%7.39%7.45%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)4.66
(-) Cash Dividends Paid (M)3.75
(=) Cash Retained (M)0.91
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)0.930.580.35
Cash Retained (M)0.910.910.91
(-) Cash Required (M)-0.93-0.58-0.35
(=) Excess Retained (M)-0.020.330.56
(/) Shares Outstanding (M)8.208.208.20
(=) Excess Retained per Share0.000.040.07
LTM Dividend per Share0.460.460.46
(+) Excess Retained per Share0.000.040.07
(=) Adjusted Dividend0.450.500.53
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate-10.67%-9.67%-8.67%
Fair Value$2.06$2.40$2.71
Upside / Downside-72.86%-68.38%-64.30%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)4.664.213.803.443.102.802.89
Payout Ratio80.40%82.32%84.24%86.16%88.08%90.00%92.50%
Projected Dividends (M)3.753.473.202.962.732.522.67

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate-10.67%-9.67%-8.67%
Year 1 PV (M)3.143.183.21
Year 2 PV (M)2.632.692.75
Year 3 PV (M)2.212.282.36
Year 4 PV (M)1.851.932.02
Year 5 PV (M)1.551.631.73
PV of Terminal Value (M)26.9128.4530.06
Equity Value (M)38.2840.1742.13
Shares Outstanding (M)8.208.208.20
Fair Value$4.67$4.90$5.14
Upside / Downside-38.40%-35.37%-32.22%

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