AGREE REALTY CORP (ADC) Stock Fundamental Analysis
NYSE:ADC - New York Stock Exchange, Inc. - US0084921008 - REIT - Currency: USD
Taking everything into account, ADC scores 4 out of 10 in our fundamental rating. ADC was compared to 130 industry peers in the Diversified REITs industry. While ADC belongs to the best of the industry regarding profitability, there are concerns on its financial health. While showing a medium growth rate, ADC is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year ADC was profitable.
ADC had a positive operating cash flow in the past year.
In the past 5 years ADC has always been profitable.
In the past 5 years ADC always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 2.08%, ADC is in the better half of the industry, outperforming 69.23% of the companies in the same industry.
ADC has a better Return On Equity (3.25%) than 61.54% of its industry peers.
ADC has a Return On Invested Capital (2.81%) which is in line with its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ADC is in line with the industry average of 3.16%.
The last Return On Invested Capital (2.81%) for ADC is above the 3 year average (2.69%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.08% | ||
| ROE | 3.25% | ||
| ROIC | 2.81% |
ROA(3y)2.13%
ROA(5y)2.2%
ROE(3y)3.18%
ROE(5y)3.33%
ROIC(3y)2.69%
ROIC(5y)2.7%
1.3 Margins
The Profit Margin of ADC (28.80%) is better than 86.15% of its industry peers.
In the last couple of years the Profit Margin of ADC has declined.
With an excellent Operating Margin value of 48.26%, ADC belongs to the best of the industry, outperforming 90.00% of the companies in the same industry.
In the last couple of years the Operating Margin of ADC has declined.
The Gross Margin of ADC (88.21%) is better than 89.23% of its industry peers.
In the last couple of years the Gross Margin of ADC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 48.26% | ||
| PM (TTM) | 28.8% | ||
| GM | 88.21% |
OM growth 3Y-2.54%
OM growth 5Y-2.49%
PM growth 3Y-5.95%
PM growth 5Y-7.12%
GM growth 3Y-0.09%
GM growth 5Y0.01%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ADC is destroying value.
Compared to 1 year ago, ADC has more shares outstanding
The number of shares outstanding for ADC has been increased compared to 5 years ago.
ADC has a worse debt/assets ratio than last year.
2.2 Solvency
ADC has an Altman-Z score of 1.61. This is a bad value and indicates that ADC is not financially healthy and even has some risk of bankruptcy.
With an excellent Altman-Z score value of 1.61, ADC belongs to the best of the industry, outperforming 91.54% of the companies in the same industry.
ADC has a Debt/Equity ratio of 0.52. This is a neutral value indicating ADC is somewhat dependend on debt financing.
ADC has a better Debt to Equity ratio (0.52) than 87.69% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.52 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.61 |
ROIC/WACC0.37
WACC7.69%
2.3 Liquidity
A Current Ratio of 0.74 indicates that ADC may have some problems paying its short term obligations.
ADC has a worse Current ratio (0.74) than 63.85% of its industry peers.
A Quick Ratio of 0.73 indicates that ADC may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.73, ADC is doing worse than 61.54% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.74 | ||
| Quick Ratio | 0.73 |
3. Growth
3.1 Past
ADC shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 7.27%.
Measured over the past years, ADC shows a decrease in Earnings Per Share. The EPS has been decreasing by -1.17% on average per year.
The Revenue has grown by 13.65% in the past year. This is quite good.
ADC shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 26.90% yearly.
EPS 1Y (TTM)7.27%
EPS 3Y-2.44%
EPS 5Y-1.17%
EPS Q2Q%-10.64%
Revenue 1Y (TTM)13.65%
Revenue growth 3Y22.06%
Revenue growth 5Y26.9%
Sales Q2Q%13.19%
3.2 Future
Based on estimates for the next years, ADC will show a small growth in Earnings Per Share. The EPS will grow by 3.40% on average per year.
ADC is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 14.41% yearly.
EPS Next Y1.4%
EPS Next 2Y5.88%
EPS Next 3Y5.4%
EPS Next 5Y3.4%
Revenue Next Year14.03%
Revenue Next 2Y12.32%
Revenue Next 3Y12.23%
Revenue Next 5Y14.41%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
ADC is valuated quite expensively with a Price/Earnings ratio of 40.66.
Compared to the rest of the industry, the Price/Earnings ratio of ADC is on the same level as its industry peers.
ADC's Price/Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 27.45.
ADC is valuated quite expensively with a Price/Forward Earnings ratio of 35.28.
ADC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. ADC is cheaper than 68.46% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of ADC to the average of the S&P500 Index (21.90), we can say ADC is valued expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 40.66 | ||
| Fwd PE | 35.28 |
4.2 Price Multiples
ADC's Enterprise Value to EBITDA ratio is rather expensive when compared to the industry. ADC is more expensive than 87.69% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 20.83 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ADC does not grow enough to justify the current Price/Earnings ratio.
ADC has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)29.12
PEG (5Y)N/A
EPS Next 2Y5.88%
EPS Next 3Y5.4%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.27%, ADC is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 6.66, ADC is paying slightly less dividend.
Compared to an average S&P500 Dividend Yield of 2.38, ADC pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.27% |
5.2 History
The dividend of ADC is nicely growing with an annual growth rate of 6.62%!
ADC has been paying a dividend for at least 10 years, so it has a reliable track record.
ADC has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)6.62%
Div Incr Years12
Div Non Decr Years13
5.3 Sustainability
173.49% of the earnings are spent on dividend by ADC. This is not a sustainable payout ratio.
ADC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP173.49%
EPS Next 2Y5.88%
EPS Next 3Y5.4%
71.97
-0.09 (-0.12%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryDiversified REITs
Earnings (Last)
Earnings (Next)
Inst Owners104.66%
Inst Owner Change3.19%
Ins Owners1.33%
Ins Owner Change5.91%
Market Cap7.92B
Analysts80
Price Target83.67 (16.26%)
Short Float %10.59%
Short Ratio8.95
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.27% |
Yearly Dividend2.99
Dividend Growth(5Y)6.62%
DP173.49%
Div Incr Years12
Div Non Decr Years13
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-3.59%
Min EPS beat(2)-5.6%
Max EPS beat(2)-1.58%
EPS beat(4)1
Avg EPS beat(4)1.46%
Min EPS beat(4)-5.6%
Max EPS beat(4)16.63%
EPS beat(8)2
Avg EPS beat(8)-2.55%
EPS beat(12)4
Avg EPS beat(12)-1.41%
EPS beat(16)7
Avg EPS beat(16)0.32%
Revenue beat(2)2
Avg Revenue beat(2)1.99%
Min Revenue beat(2)1.78%
Max Revenue beat(2)2.2%
Revenue beat(4)4
Avg Revenue beat(4)1.87%
Min Revenue beat(4)1.32%
Max Revenue beat(4)2.2%
Revenue beat(8)8
Avg Revenue beat(8)1.63%
Revenue beat(12)11
Avg Revenue beat(12)1.52%
Revenue beat(16)12
Avg Revenue beat(16)1.02%
PT rev (1m)0.37%
PT rev (3m)2.53%
EPS NQ rev (1m)0%
EPS NQ rev (3m)5.06%
EPS NY rev (1m)-0.43%
EPS NY rev (3m)2.58%
Revenue NQ rev (1m)0.28%
Revenue NQ rev (3m)2.07%
Revenue NY rev (1m)0.98%
Revenue NY rev (3m)2.65%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 40.66 | ||
| Fwd PE | 35.28 | ||
| P/S | 12.43 | ||
| P/FCF | N/A | ||
| P/OCF | 17.38 | ||
| P/B | 1.4 | ||
| P/tB | 1.67 | ||
| EV/EBITDA | 20.83 |
EPS(TTM)1.77
EY2.46%
EPS(NY)2.04
Fwd EY2.83%
FCF(TTM)-6.89
FCFYN/A
OCF(TTM)4.14
OCFY5.75%
SpS5.79
BVpS51.3
TBVpS43.15
PEG (NY)29.12
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.08% | ||
| ROE | 3.25% | ||
| ROCE | 3.55% | ||
| ROIC | 2.81% | ||
| ROICexc | 2.81% | ||
| ROICexgc | 3.15% | ||
| OM | 48.26% | ||
| PM (TTM) | 28.8% | ||
| GM | 88.21% | ||
| FCFM | N/A |
ROA(3y)2.13%
ROA(5y)2.2%
ROE(3y)3.18%
ROE(5y)3.33%
ROIC(3y)2.69%
ROIC(5y)2.7%
ROICexc(3y)2.69%
ROICexc(5y)2.7%
ROICexgc(3y)3.04%
ROICexgc(5y)3.08%
ROCE(3y)3.4%
ROCE(5y)3.41%
ROICexcg growth 3Y-0.04%
ROICexcg growth 5Y-2.84%
ROICexc growth 3Y1%
ROICexc growth 5Y-2.17%
OM growth 3Y-2.54%
OM growth 5Y-2.49%
PM growth 3Y-5.95%
PM growth 5Y-7.12%
GM growth 3Y-0.09%
GM growth 5Y0.01%
F-Score5
Asset Turnover0.07
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.52 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 5.66 | ||
| Cap/Depr | 566.4% | ||
| Cap/Sales | 190.59% | ||
| Interest Coverage | 2.49 | ||
| Cash Conversion | 87.33% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.74 | ||
| Quick Ratio | 0.73 | ||
| Altman-Z | 1.61 |
F-Score5
WACC7.69%
ROIC/WACC0.37
Cap/Depr(3y)815.29%
Cap/Depr(5y)1193.64%
Cap/Sales(3y)261.47%
Cap/Sales(5y)350.2%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)7.27%
EPS 3Y-2.44%
EPS 5Y-1.17%
EPS Q2Q%-10.64%
EPS Next Y1.4%
EPS Next 2Y5.88%
EPS Next 3Y5.4%
EPS Next 5Y3.4%
Revenue 1Y (TTM)13.65%
Revenue growth 3Y22.06%
Revenue growth 5Y26.9%
Sales Q2Q%13.19%
Revenue Next Year14.03%
Revenue Next 2Y12.32%
Revenue Next 3Y12.23%
Revenue Next 5Y14.41%
EBIT growth 1Y12.9%
EBIT growth 3Y18.97%
EBIT growth 5Y23.75%
EBIT Next Year100.81%
EBIT Next 3Y38.22%
EBIT Next 5Y28.18%
FCF growth 1Y34.09%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y15.37%
OCF growth 3Y20.6%
OCF growth 5Y27.8%