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Northwest Natural Holding Company (NWN)

Company Dividend Discount ModelIndustry: Regulated GasSector: Utilities

Valuation Snapshot

Stable Growth$44.58 - $92.24$62.73
Multi-Stage$40.44 - $44.08$42.23
Blended Fair Value$52.48
Current Price$44.93
Upside16.80%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS6.43%3.82%1.801.661.551.381.371.321.271.331.271.21
YoY Growth--8.19%7.28%12.25%0.90%3.90%3.95%-4.90%4.75%4.60%-1.70%
Dividend Yield--4.21%4.47%3.25%2.67%2.53%2.13%1.94%2.32%2.15%2.26%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)100.53
(-) Cash Dividends Paid (M)76.66
(=) Cash Retained (M)23.87
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)20.1112.577.54
Cash Retained (M)23.8723.8723.87
(-) Cash Required (M)-20.11-12.57-7.54
(=) Excess Retained (M)3.7711.3116.33
(/) Shares Outstanding (M)40.5540.5540.55
(=) Excess Retained per Share0.090.280.40
LTM Dividend per Share1.891.891.89
(+) Excess Retained per Share0.090.280.40
(=) Adjusted Dividend1.982.172.29
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate4.43%5.43%6.43%
Fair Value$44.58$62.73$92.24
Upside / Downside-0.78%39.61%105.29%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)100.53105.99111.75117.82124.22130.97134.90
Payout Ratio76.25%79.00%81.75%84.50%87.25%90.00%92.50%
Projected Dividends (M)76.6683.7491.3699.56108.39117.88124.79

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate4.43%5.43%6.43%
Year 1 PV (M)76.0476.7777.49
Year 2 PV (M)75.3376.7878.25
Year 3 PV (M)74.5576.7178.91
Year 4 PV (M)73.7076.5679.50
Year 5 PV (M)72.7876.3380.02
PV of Terminal Value (M)1,267.191,329.031,393.26
Equity Value (M)1,639.581,712.181,787.44
Shares Outstanding (M)40.5540.5540.55
Fair Value$40.44$42.23$44.08
Upside / Downside-10.00%-6.02%-1.89%

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