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PPL Corporation (PPL)

Company Dividend Discount ModelIndustry: Regulated ElectricSector: Utilities

Valuation Snapshot

Stable Growth$11.25 - $16.46$13.76
Multi-Stage$18.54 - $20.28$19.39
Blended Fair Value$16.58
Current Price$33.89
Upside-51.08%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS-8.92%-2.55%1.010.951.061.721.721.611.531.441.391.35
YoY Growth--6.11%-10.55%-38.47%0.31%6.96%5.21%5.69%4.08%2.59%3.83%
Dividend Yield--2.79%3.45%3.81%6.03%5.96%6.51%4.82%5.10%3.71%3.55%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)1,092.00
(-) Cash Dividends Paid (M)783.00
(=) Cash Retained (M)309.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)218.40136.5081.90
Cash Retained (M)309.00309.00309.00
(-) Cash Required (M)-218.40-136.50-81.90
(=) Excess Retained (M)90.60172.50227.10
(/) Shares Outstanding (M)742.32742.32742.32
(=) Excess Retained per Share0.120.230.31
LTM Dividend per Share1.051.051.05
(+) Excess Retained per Share0.120.230.31
(=) Adjusted Dividend1.181.291.36
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate-1.25%-0.25%0.75%
Fair Value$11.25$13.76$16.46
Upside / Downside-66.80%-59.39%-51.43%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)1,092.001,089.281,086.571,083.861,081.161,078.471,110.83
Payout Ratio71.70%75.36%79.02%82.68%86.34%90.00%92.50%
Projected Dividends (M)783.00820.91858.63896.15933.48970.621,027.51

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate-1.25%-0.25%0.75%
Year 1 PV (M)745.03752.58760.12
Year 2 PV (M)707.23721.63736.17
Year 3 PV (M)669.91690.47711.45
Year 4 PV (M)633.32659.37686.21
Year 5 PV (M)597.65628.53660.67
PV of Terminal Value (M)10,405.8910,943.5511,503.20
Equity Value (M)13,759.0414,396.1215,057.82
Shares Outstanding (M)742.32742.32742.32
Fair Value$18.54$19.39$20.28
Upside / Downside-45.31%-42.78%-40.15%

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