NNN REIT INC (NNN) Stock Fundamental Analysis
NYSE:NNN - New York Stock Exchange, Inc. - US6374171063 - REIT - Currency: USD
Overall NNN gets a fundamental rating of 5 out of 10. We evaluated NNN against 130 industry peers in the Diversified REITs industry. NNN scores excellent on profitability, but there are concerns on its financial health. NNN has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year NNN was profitable.
NNN had a positive operating cash flow in the past year.
NNN had positive earnings in each of the past 5 years.
NNN had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
NNN has a better Return On Assets (5.53%) than 96.15% of its industry peers.
NNN has a better Return On Equity (11.24%) than 91.54% of its industry peers.
The Return On Invested Capital of NNN (6.06%) is better than 94.62% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for NNN is in line with the industry average of 3.17%.
The last Return On Invested Capital (6.06%) for NNN is above the 3 year average (4.76%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.53% | ||
| ROE | 11.24% | ||
| ROIC | 6.06% |
ROA(3y)4.36%
ROA(5y)3.85%
ROE(3y)8.87%
ROE(5y)7.65%
ROIC(3y)4.76%
ROIC(5y)4.6%
1.3 Margins
With an excellent Profit Margin value of 45.21%, NNN belongs to the best of the industry, outperforming 94.62% of the companies in the same industry.
In the last couple of years the Profit Margin of NNN has grown nicely.
Looking at the Operating Margin, with a value of 62.51%, NNN belongs to the top of the industry, outperforming 96.15% of the companies in the same industry.
NNN's Operating Margin has been stable in the last couple of years.
The Gross Margin of NNN (96.36%) is better than 96.92% of its industry peers.
In the last couple of years the Gross Margin of NNN has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 62.51% | ||
| PM (TTM) | 45.21% | ||
| GM | 96.36% |
OM growth 3Y0.41%
OM growth 5Y0.12%
PM growth 3Y7.9%
PM growth 5Y3.47%
GM growth 3Y0.07%
GM growth 5Y0.09%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so NNN is destroying value.
Compared to 1 year ago, NNN has more shares outstanding
NNN has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, NNN has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.27, we must say that NNN is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.27, NNN belongs to the top of the industry, outperforming 86.92% of the companies in the same industry.
NNN has a debt to FCF ratio of 69.84. This is a negative value and a sign of low solvency as NNN would need 69.84 years to pay back of all of its debts.
The Debt to FCF ratio of NNN (69.84) is comparable to the rest of the industry.
NNN has a Debt/Equity ratio of 1.00. This is a high value indicating a heavy dependency on external financing.
NNN has a Debt to Equity ratio (1.00) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1 | ||
| Debt/FCF | 69.84 | ||
| Altman-Z | 1.27 |
ROIC/WACC0.88
WACC6.88%
2.3 Liquidity
A Current Ratio of 0.39 indicates that NNN may have some problems paying its short term obligations.
With a Current ratio value of 0.39, NNN is not doing good in the industry: 83.85% of the companies in the same industry are doing better.
NNN has a Quick Ratio of 0.39. This is a bad value and indicates that NNN is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.39, NNN is doing worse than 83.08% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.39 | ||
| Quick Ratio | 0.39 |
3. Growth
3.1 Past
NNN shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 14.68%, which is quite good.
Measured over the past 5 years, NNN shows a small growth in Earnings Per Share. The EPS has been growing by 6.63% on average per year.
Looking at the last year, NNN shows a small growth in Revenue. The Revenue has grown by 4.97% in the last year.
NNN shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.33% yearly.
EPS 1Y (TTM)14.68%
EPS 3Y12.5%
EPS 5Y6.63%
EPS Q2Q%67.31%
Revenue 1Y (TTM)4.97%
Revenue growth 3Y6.17%
Revenue growth 5Y5.33%
Sales Q2Q%7.04%
3.2 Future
The Earnings Per Share is expected to decrease by -0.25% on average over the next years.
Based on estimates for the next years, NNN will show a small growth in Revenue. The Revenue will grow by 5.37% on average per year.
EPS Next Y-6.93%
EPS Next 2Y-1.6%
EPS Next 3Y-0.25%
EPS Next 5YN/A
Revenue Next Year3.61%
Revenue Next 2Y4.13%
Revenue Next 3Y3.2%
Revenue Next 5Y5.37%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 16.49 indicates a correct valuation of NNN.
Compared to the rest of the industry, the Price/Earnings ratio of NNN indicates a rather cheap valuation: NNN is cheaper than 82.31% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of NNN to the average of the S&P500 Index (27.75), we can say NNN is valued slightly cheaper.
With a Price/Forward Earnings ratio of 19.80, NNN is valued on the expensive side.
Based on the Price/Forward Earnings ratio, NNN is valued cheaper than 90.77% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 20.49. NNN is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.49 | ||
| Fwd PE | 19.8 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NNN is valued a bit cheaper than 60.77% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of NNN is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 123.78 | ||
| EV/EBITDA | 13.06 |
4.3 Compensation for Growth
NNN has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.49
EPS Next 2Y-1.6%
EPS Next 3Y-0.25%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 5.63%, NNN is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 16.33, NNN has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.44, NNN pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.63% |
5.2 History
The dividend of NNN has a limited annual growth rate of 0.74%.
NNN has paid a dividend for at least 10 years, which is a reliable track record.
NNN has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)0.74%
Div Incr Years33
Div Non Decr Years33
5.3 Sustainability
85.70% of the earnings are spent on dividend by NNN. This is not a sustainable payout ratio.
NNN's earnings are declining while the Dividend Rate has been growing. This means the dividend growth is most likely not sustainable.
DP85.7%
EPS Next 2Y-1.6%
EPS Next 3Y-0.25%
41.23
+0.12 (+0.29%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryDiversified REITs
Earnings (Last)
Earnings (Next)
Inst Owners94.12%
Inst Owner Change-0.1%
Ins Owners0.54%
Ins Owner Change11.72%
Market Cap7.75B
Analysts66.09
Price Target45.21 (9.65%)
Short Float %3.01%
Short Ratio3.67
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.63% |
Yearly Dividend2.27
Dividend Growth(5Y)0.74%
DP85.7%
Div Incr Years33
Div Non Decr Years33
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.57%
Min EPS beat(2)6.16%
Max EPS beat(2)6.98%
EPS beat(4)4
Avg EPS beat(4)8.95%
Min EPS beat(4)6.15%
Max EPS beat(4)16.52%
EPS beat(8)8
Avg EPS beat(8)10.78%
EPS beat(12)11
Avg EPS beat(12)7.96%
EPS beat(16)13
Avg EPS beat(16)5.08%
Revenue beat(2)1
Avg Revenue beat(2)0%
Min Revenue beat(2)-0.59%
Max Revenue beat(2)0.58%
Revenue beat(4)3
Avg Revenue beat(4)0.44%
Min Revenue beat(4)-0.59%
Max Revenue beat(4)0.92%
Revenue beat(8)5
Avg Revenue beat(8)0.63%
Revenue beat(12)7
Avg Revenue beat(12)0.52%
Revenue beat(16)10
Avg Revenue beat(16)1.11%
PT rev (1m)0.8%
PT rev (3m)-4.1%
EPS NQ rev (1m)0.08%
EPS NQ rev (3m)-2.88%
EPS NY rev (1m)-0.08%
EPS NY rev (3m)-1.43%
Revenue NQ rev (1m)0.07%
Revenue NQ rev (3m)-0.31%
Revenue NY rev (1m)0.09%
Revenue NY rev (3m)-0.3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.49 | ||
| Fwd PE | 19.8 | ||
| P/S | 7.15 | ||
| P/FCF | 123.78 | ||
| P/OCF | 12.2 | ||
| P/B | 1.78 | ||
| P/tB | 1.79 | ||
| EV/EBITDA | 13.06 |
EPS(TTM)2.5
EY6.06%
EPS(NY)2.08
Fwd EY5.05%
FCF(TTM)0.33
FCFY0.81%
OCF(TTM)3.38
OCFY8.2%
SpS5.77
BVpS23.2
TBVpS23.02
PEG (NY)N/A
PEG (5Y)2.49
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.53% | ||
| ROE | 11.24% | ||
| ROCE | 7.67% | ||
| ROIC | 6.06% | ||
| ROICexc | 6.06% | ||
| ROICexgc | 6.14% | ||
| OM | 62.51% | ||
| PM (TTM) | 45.21% | ||
| GM | 96.36% | ||
| FCFM | 5.77% |
ROA(3y)4.36%
ROA(5y)3.85%
ROE(3y)8.87%
ROE(5y)7.65%
ROIC(3y)4.76%
ROIC(5y)4.6%
ROICexc(3y)4.76%
ROICexc(5y)4.65%
ROICexgc(3y)4.82%
ROICexgc(5y)4.72%
ROCE(3y)6.02%
ROCE(5y)5.82%
ROICexcg growth 3Y1.06%
ROICexcg growth 5Y1.72%
ROICexc growth 3Y1.19%
ROICexc growth 5Y1.8%
OM growth 3Y0.41%
OM growth 5Y0.12%
PM growth 3Y7.9%
PM growth 5Y3.47%
GM growth 3Y0.07%
GM growth 5Y0.09%
F-Score7
Asset Turnover0.12
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1 | ||
| Debt/FCF | 69.84 | ||
| Debt/EBITDA | 4.71 | ||
| Cap/Depr | 229.44% | ||
| Cap/Sales | 52.82% | ||
| Interest Coverage | 3.7 | ||
| Cash Conversion | 68.5% | ||
| Profit Quality | 12.77% | ||
| Current Ratio | 0.39 | ||
| Quick Ratio | 0.39 | ||
| Altman-Z | 1.27 |
F-Score7
WACC6.88%
ROIC/WACC0.88
Cap/Depr(3y)313.19%
Cap/Depr(5y)261.77%
Cap/Sales(3y)90.34%
Cap/Sales(5y)75.37%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)14.68%
EPS 3Y12.5%
EPS 5Y6.63%
EPS Q2Q%67.31%
EPS Next Y-6.93%
EPS Next 2Y-1.6%
EPS Next 3Y-0.25%
EPS Next 5YN/A
Revenue 1Y (TTM)4.97%
Revenue growth 3Y6.17%
Revenue growth 5Y5.33%
Sales Q2Q%7.04%
Revenue Next Year3.61%
Revenue Next 2Y4.13%
Revenue Next 3Y3.2%
Revenue Next 5Y5.37%
EBIT growth 1Y31.03%
EBIT growth 3Y6.6%
EBIT growth 5Y5.46%
EBIT Next Year48.44%
EBIT Next 3Y17.72%
EBIT Next 5Y14.3%
FCF growth 1Y134.15%
FCF growth 3Y60.67%
FCF growth 5YN/A
OCF growth 1Y3.77%
OCF growth 3Y3.79%
OCF growth 5Y4.84%