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Unity Bancorp, Inc. (UNTY)

Company Dividend Discount ModelIndustry: Banks - RegionalSector: Financial Services

Valuation Snapshot

Stable Growth$123.88 - $328.61$189.42
Multi-Stage$83.38 - $91.18$87.21
Blended Fair Value$138.31
Current Price$48.87
Upside183.03%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS9.06%20.83%0.490.460.430.350.320.320.270.230.150.11
YoY Growth--6.35%7.96%20.90%9.67%1.32%16.17%17.73%56.17%37.42%46.50%
Dividend Yield--1.21%1.67%1.88%1.26%1.47%2.72%1.45%1.06%0.88%1.05%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)53.99
(-) Cash Dividends Paid (M)5.42
(=) Cash Retained (M)48.57
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)10.806.754.05
Cash Retained (M)48.5748.5748.57
(-) Cash Required (M)-10.80-6.75-4.05
(=) Excess Retained (M)37.7741.8244.52
(/) Shares Outstanding (M)10.2210.2210.22
(=) Excess Retained per Share3.694.094.35
LTM Dividend per Share0.530.530.53
(+) Excess Retained per Share3.694.094.35
(=) Adjusted Dividend4.224.624.88
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Fair Value$123.88$189.42$328.61
Upside / Downside153.48%287.60%572.41%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)53.9957.5061.2465.2269.4673.9776.19
Payout Ratio10.03%26.03%42.02%58.01%74.01%90.00%92.50%
Projected Dividends (M)5.4214.9625.7337.8351.4066.5770.47

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Year 1 PV (M)13.5913.7213.85
Year 2 PV (M)21.2121.6222.03
Year 3 PV (M)28.3229.1429.96
Year 4 PV (M)34.9436.2837.67
Year 5 PV (M)41.0943.0745.13
PV of Terminal Value (M)713.30747.76783.53
Equity Value (M)852.46891.59932.17
Shares Outstanding (M)10.2210.2210.22
Fair Value$83.38$87.21$91.18
Upside / Downside70.62%78.45%86.57%

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