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First Trust MLP and Energy Income Fund (FEI)

Company Dividend Discount ModelIndustry: Asset Management - IncomeSector: Financial Services

Valuation Snapshot

Stable Growth$14.50 - $20.87$17.61
Multi-Stage$24.51 - $26.86$25.67
Blended Fair Value$21.64
Current Price$8.43
Upside156.68%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2023202220212020201920182017201620152014
DPS0.00%0.00%0.600.600.600.941.250.001.441.430.000.00
YoY Growth--0.00%-0.57%-35.49%-25.00%0.00%-100.00%0.69%0.00%0.00%0.00%
Dividend Yield--7.12%7.54%7.67%19.01%11.35%0.00%9.91%9.11%0.00%0.00%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)92.68
(-) Cash Dividends Paid (M)54.27
(=) Cash Retained (M)38.40
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)18.5411.586.95
Cash Retained (M)38.4038.4038.40
(-) Cash Required (M)-18.54-11.58-6.95
(=) Excess Retained (M)19.8726.8231.45
(/) Shares Outstanding (M)45.2345.2345.23
(=) Excess Retained per Share0.440.590.70
LTM Dividend per Share1.201.201.20
(+) Excess Retained per Share0.440.590.70
(=) Adjusted Dividend1.641.791.90
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate-2.00%-1.00%0.00%
Fair Value$14.50$17.61$20.87
Upside / Downside71.99%108.89%147.62%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)92.6891.7590.8389.9389.0388.1490.78
Payout Ratio58.56%64.85%71.14%77.42%83.71%90.00%92.50%
Projected Dividends (M)54.2759.5064.6269.6274.5379.3283.97

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate-2.00%-1.00%0.00%
Year 1 PV (M)54.0054.5555.10
Year 2 PV (M)53.2254.3155.41
Year 3 PV (M)52.0453.6455.29
Year 4 PV (M)50.5552.6454.80
Year 5 PV (M)48.8251.3754.01
PV of Terminal Value (M)850.08894.34940.43
Equity Value (M)1,108.691,160.851,215.04
Shares Outstanding (M)45.2345.2345.23
Fair Value$24.51$25.67$26.86
Upside / Downside190.78%204.46%218.67%

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