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Morgan Stanley (MS)

Company Dividend Discount ModelIndustry: Financial - Capital MarketsSector: Financial Services

Valuation Snapshot

Stable Growth$237.41 - $629.78$363.02
Multi-Stage$165.50 - $180.66$172.94
Blended Fair Value$267.98
Current Price$158.96
Upside68.58%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS18.50%21.11%3.843.613.382.611.711.641.491.301.090.91
YoY Growth--6.51%6.70%29.49%52.28%4.26%10.61%13.91%19.42%20.00%60.95%
Dividend Yield--3.29%3.85%3.85%2.99%2.21%4.83%3.41%2.42%2.55%3.64%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)16,178.00
(-) Cash Dividends Paid (M)6,490.00
(=) Cash Retained (M)9,688.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)3,235.602,022.251,213.35
Cash Retained (M)9,688.009,688.009,688.00
(-) Cash Required (M)-3,235.60-2,022.25-1,213.35
(=) Excess Retained (M)6,452.407,665.758,474.65
(/) Shares Outstanding (M)1,598.501,598.501,598.50
(=) Excess Retained per Share4.044.805.30
LTM Dividend per Share4.064.064.06
(+) Excess Retained per Share4.044.805.30
(=) Adjusted Dividend8.108.869.36
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Fair Value$237.41$363.02$629.78
Upside / Downside49.35%128.37%296.18%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)16,178.0017,229.5718,349.4919,542.2120,812.4522,165.2622,830.22
Payout Ratio40.12%50.09%60.07%70.05%80.02%90.00%92.50%
Projected Dividends (M)6,490.008,630.8011,022.4913,688.6316,654.8019,948.7421,117.95

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Year 1 PV (M)7,836.777,911.057,985.34
Year 2 PV (M)9,087.659,260.759,435.48
Year 3 PV (M)10,247.5110,541.6710,841.42
Year 4 PV (M)11,320.9711,756.3412,204.15
Year 5 PV (M)12,312.4812,907.1813,524.64
PV of Terminal Value (M)213,744.39224,068.32234,787.38
Equity Value (M)264,549.78276,445.33288,778.40
Shares Outstanding (M)1,598.501,598.501,598.50
Fair Value$165.50$172.94$180.66
Upside / Downside4.11%8.79%13.65%

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