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Neo Corporate PCL (NEO.BK)

Company Dividend Discount ModelIndustry: Household & Personal ProductsSector: Consumer Defensive

Valuation Snapshot

Stable Growth$27.93 - $44.67$35.52
Multi-Stage$59.60 - $65.55$62.51
Blended Fair Value$49.02
Current Price$25.75
Upside90.35%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR202420232022202120202019
DPS0.80%0.00%1.675.560.900.700.461.600.000.000.000.00
YoY Growth---70.05%520.83%27.03%51.87%-70.99%0.00%0.00%0.00%0.00%0.00%
Dividend Yield--5.89%14.25%2.30%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)808.15
(-) Cash Dividends Paid (M)405.00
(=) Cash Retained (M)403.15
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)161.63101.0260.61
Cash Retained (M)403.15403.15403.15
(-) Cash Required (M)-161.63-101.02-60.61
(=) Excess Retained (M)241.52302.13342.54
(/) Shares Outstanding (M)300.00300.00300.00
(=) Excess Retained per Share0.811.011.14
LTM Dividend per Share1.351.351.35
(+) Excess Retained per Share0.811.011.14
(=) Adjusted Dividend2.162.362.49
WACC / Discount Rate6.42%6.42%6.42%
Growth Rate-1.20%-0.20%0.80%
Fair Value$27.93$35.52$44.67
Upside / Downside8.47%37.93%73.47%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)808.15806.54804.93803.32801.72800.12824.12
Payout Ratio50.11%58.09%66.07%74.05%82.02%90.00%92.50%
Projected Dividends (M)405.00468.53531.80594.82657.59720.10762.31

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate6.42%6.42%6.42%
Growth Rate-1.20%-0.20%0.80%
Year 1 PV (M)435.84440.25444.66
Year 2 PV (M)460.18469.54479.00
Year 3 PV (M)478.80493.49508.47
Year 4 PV (M)492.39512.63533.49
Year 5 PV (M)501.58527.48554.44
PV of Terminal Value (M)15,509.8816,310.8417,144.55
Equity Value (M)17,878.6718,754.2419,664.62
Shares Outstanding (M)300.00300.00300.00
Fair Value$59.60$62.51$65.55
Upside / Downside131.44%142.77%154.56%

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