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Headwater Exploration Inc. (HWX.TO)

Company Dividend Discount ModelIndustry: Oil & Gas Exploration & ProductionSector: Energy

Valuation Snapshot

Stable Growth$39.81 - $143.96$126.14
Multi-Stage$18.57 - $20.30$19.42
Blended Fair Value$72.78
Current Price$6.73
Upside981.43%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS0.00%0.00%0.400.390.000.000.000.000.000.000.000.00
YoY Growth--0.81%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%
Dividend Yield--6.16%5.09%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)172.80
(-) Cash Dividends Paid (M)99.85
(=) Cash Retained (M)72.95
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)34.5621.6012.96
Cash Retained (M)72.9572.9572.95
(-) Cash Required (M)-34.56-21.60-12.96
(=) Excess Retained (M)38.3951.3559.99
(/) Shares Outstanding (M)238.72238.72238.72
(=) Excess Retained per Share0.160.220.25
LTM Dividend per Share0.420.420.42
(+) Excess Retained per Share0.160.220.25
(=) Adjusted Dividend0.580.630.67
WACC / Discount Rate7.03%7.03%7.03%
Growth Rate5.50%6.50%7.50%
Fair Value$39.81$126.14$143.96
Upside / Downside491.49%1,774.35%2,039.09%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)172.80184.04196.00208.74222.31236.76243.86
Payout Ratio57.78%64.23%70.67%77.11%83.56%90.00%92.50%
Projected Dividends (M)99.85118.20138.51160.97185.75213.08225.57

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate7.03%7.03%7.03%
Growth Rate5.50%6.50%7.50%
Year 1 PV (M)109.40110.43111.47
Year 2 PV (M)118.64120.90123.18
Year 3 PV (M)127.60131.27135.00
Year 4 PV (M)136.28141.52146.92
Year 5 PV (M)144.69151.68158.93
PV of Terminal Value (M)3,796.223,979.584,169.95
Equity Value (M)4,432.834,635.384,845.45
Shares Outstanding (M)238.72238.72238.72
Fair Value$18.57$19.42$20.30
Upside / Downside175.92%188.52%201.60%

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