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The Marzetti Company (MZTI)

Company Dividend Discount ModelIndustry: Packaged FoodsSector: Consumer Defensive

Valuation Snapshot

Stable Growth$111.62 - $231.70$157.24
Multi-Stage$98.99 - $107.99$103.41
Blended Fair Value$130.32
Current Price$172.79
Upside-24.58%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2025202420232022202120202019201820172016
DPS6.47%7.59%3.773.563.363.162.962.752.552.352.156.93
YoY Growth--5.69%6.03%6.46%6.81%7.39%7.89%8.65%9.41%-69.05%282.79%
Dividend Yield--2.18%2.02%2.04%2.10%1.75%1.54%1.84%1.59%1.79%5.25%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)169.83
(-) Cash Dividends Paid (M)104.95
(=) Cash Retained (M)64.87
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)33.9721.2312.74
Cash Retained (M)64.8764.8764.87
(-) Cash Required (M)-33.97-21.23-12.74
(=) Excess Retained (M)30.9143.6552.14
(/) Shares Outstanding (M)27.4927.4927.49
(=) Excess Retained per Share1.121.591.90
LTM Dividend per Share3.823.823.82
(+) Excess Retained per Share1.121.591.90
(=) Adjusted Dividend4.945.415.71
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate4.47%5.47%6.47%
Fair Value$111.62$157.24$231.70
Upside / Downside-35.40%-9.00%34.09%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)169.83179.12188.92199.26210.16221.66228.31
Payout Ratio61.80%67.44%73.08%78.72%84.36%90.00%92.50%
Projected Dividends (M)104.95120.80138.06156.86177.29199.50211.19

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate4.47%5.47%6.47%
Year 1 PV (M)109.68110.73111.78
Year 2 PV (M)113.81116.00118.21
Year 3 PV (M)117.39120.80124.27
Year 4 PV (M)120.47125.15129.96
Year 5 PV (M)123.07129.08135.31
PV of Terminal Value (M)2,136.552,240.782,349.04
Equity Value (M)2,720.972,842.532,968.57
Shares Outstanding (M)27.4927.4927.49
Fair Value$98.99$103.41$107.99
Upside / Downside-42.71%-40.15%-37.50%

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