* Note: Prices are in Million (M) USD.
Description:
WP Carey is among the largest net-lease REITs with an enterprise value of approximately $ 18 billion and a diversified portfolio of operationally critical commercial real estate that includes 1,215 net-lease properties covering approximately 142 million square feet as of March 30. September 2020.
These criteria used Company's Cash, EBITDA and Debt balance to determines its fair value:
Cash : $245 M
Debt : $0 M
EBITDA : $1,123 M
Since Cash is greater than Total Debt, 5 points assigned.
This criteria used industry in which company operates:
Sector: Real estate
Industry: Reit - diversified
Based on industry, 3 points assigned.
This criteria used Company's Price To Earning (P/E) Ratio to determines its fair value:
Forward PE Ratio: 13.51
Since Forward PE Ratio is less than 15, 5 points assigned.
This criteria used Company's ability to convert Sales into free cash flow to determine fair value:
Using last 20 overlapping fiscal years (max 20).Average Free Cash Flow: $303 M
Average Revenue: $785 M
Revenue Converted To Free Cash Flow (%): 38.6%
Since Free Cash Flow (FCF) to Revenue percentage is greater than 25, 5 points assigned.
This criteria used company's growth potential to calculate its fair value:
Latest Revenue (2024-12-31): $1,583 M
Revenue 4 Years Ago (2020-12-31): $1,209 M
Last 5 Years Average Revenue Growth: 6%
Since Revenue Growth is between 5 - 10, 2 points assigned.
This criteria used Company's ability to buy back its own share:
Latest Share Count (2024-12-31): $221 M
Share Count 5 Years Ago (2020-12-31): $175 M
Company is not buying back its own shares, 0 points assigned.
This criteria used Company's dividend payout ratio to determine its fair value:
Next Year Earnings Per Share (EPS): $4.97
Trailing 12-Month Earnings Per Share (EPS): $4.87
Average Earnings Per Share (EPS): $4.92
Dividend Per Share (DPS): $4
Payout Ratio: 72%
Dividend Yield: 5%
Since company Payout Ratio is greater than 50, 1 point assigned.
Since Dividend Yield is greater than 5, 5 points assigned.
This criteria used Company's Return On Equity (ROE%) to determine its fair value:
Using last 20 valid ROE years (max 20).Average ROE: 8.4%
Since Average ROE is less than 10, 1 point assigned.
This criteria used Company's current price to its 52 week low price to determines its fair value:
Current Price: $66
52-Week Low: $51
Threshold Price (15% Above 52-Week Low): $59
Since Current price is not within 15% threshold, 0 point assigned.
This criteria used Company's Market Cap to determines its fair value:
Market Capitalization: $14,335 M
Since Market Cap is between 10B - 100B, 2 points assigned.
% Exposure to Total Portfolio
Based on the market cap, we recommend do not exceed 3% exposure of Total Portfolio.
Value-Trade has assigned 29 points to above W P Carey Inc (WPC) stock.
Heads up: One or more P/E inputs look exaggerated and may skew the blend.
• RCFC Based PE
42.87 (>2× median)
Further research is recommended; please use your own due diligence.In such cases, multiplying earnings by the long-run average P/E typically gives a closer, more reliable fair value.
Rule of thumb: Last 19 Years Avg P/E (24.09)
× EPS ($4.92) = $118.52.
Last 19 Years Avg PE 24.09, Fair Value PE 15, Industry Based PE 20, Growth Based PE 6, RCFC Based PE 42.87, ROE Based PE 16.75, Risk-Free Anchored PE (25% MoS) 17.08. Based on these 7 values, average assigned is 20.26. Value-Trades has assined P/E value 20.26. Since an average (Current Year EPS + Next Year EPS) earning per share is $4.92.
The fair value of W P Carey Inc (WPC) stock should be (20.26 x $4.92) = $99.66.
