LFT gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 68 industry peers in the Mortgage Real Estate Investment Trusts (REITs)" industry. There are concerns on the financial health of LFT while its profitability can be described as average. LFT is valued correctly, but it does not seem to be growing.

Quickly go to:

1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year LFT was profitable.
In the past year LFT had a positive cash flow from operations.
LFT had positive earnings in each of the past 5 years.
In the past 5 years LFT always reported a positive cash flow from operatings.

1.2 Ratios

LFT's Return On Assets of 0.53% is in line compared to the rest of the industry. LFT outperforms 57.35% of its industry peers.
The Return On Equity of LFT (2.20%) is comparable to the rest of the industry.
LFT has a better Return On Invested Capital (0.81%) than 70.59% of its industry peers.
LFT had an Average Return On Invested Capital over the past 3 years of 1.11%. This is in line with the industry average of 1.28%.

		Industry Rank	Sector Rank
ROA	0.53%
ROE	2.2%
ROIC	0.81%

ROA(3y)1.02%

ROA(5y)1.03%

ROE(3y)5.28%

ROE(5y)5.52%

ROIC(3y)1.11%

ROIC(5y)1.09%

1.3 Margins

LFT has a Profit Margin of 5.78%. This is comparable to the rest of the industry: LFT outperforms 45.59% of its industry peers.
LFT's Profit Margin has improved in the last couple of years.
LFT has a Operating Margin (11.12%) which is in line with its industry peers.
In the last couple of years the Operating Margin of LFT has grown nicely.
LFT's Gross Margin of 27.94% is in line compared to the rest of the industry. LFT outperforms 50.00% of its industry peers.
In the last couple of years the Gross Margin of LFT has declined.

		Industry Rank	Sector Rank
OM	11.12%
PM (TTM)	5.78%
GM	27.94%

OM growth 3Y-18.37%

OM growth 5Y3.71%

PM growth 3Y-10.48%

PM growth 5Y15.78%

GM growth 3Y-20.78%

GM growth 5Y-5.82%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The number of shares outstanding for LFT remains at a similar level compared to 1 year ago.
The number of shares outstanding for LFT has been increased compared to 5 years ago.
Compared to 1 year ago, LFT has an improved debt to assets ratio.

2.2 Solvency

Based on the Altman-Z score of -0.79, we must say that LFT is in the distress zone and has some risk of bankruptcy.
LFT has a Altman-Z score of -0.79. This is in the lower half of the industry: LFT underperforms 76.47% of its industry peers.
LFT has a debt to FCF ratio of 47.27. This is a negative value and a sign of low solvency as LFT would need 47.27 years to pay back of all of its debts.
The Debt to FCF ratio of LFT (47.27) is better than 79.41% of its industry peers.
A Debt/Equity ratio of 3.12 is on the high side and indicates that LFT has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 3.12, LFT is in the better half of the industry, outperforming 73.53% of the companies in the same industry.

		Industry Rank	Sector Rank
Debt/Equity	3.12
Debt/FCF	47.27
Altman-Z	-0.79

ROIC/WACCN/A

WACCN/A

2.3 Liquidity

A Current Ratio of 0.11 indicates that LFT may have some problems paying its short term obligations.
The Current ratio of LFT (0.11) is worse than 63.24% of its industry peers.
A Quick Ratio of 0.11 indicates that LFT may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.11, LFT is doing worse than 63.24% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	0.11
Quick Ratio	0.11

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The earnings per share for LFT have decreased strongly by -43.18% in the last year.
LFT shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.58% yearly.
The Revenue for LFT has decreased by -31.72% in the past year. This is quite bad
LFT shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 26.10% yearly.

EPS 1Y (TTM)-43.18%

EPS 3Y2.38%

EPS 5Y6.58%

EPS Q2Q%-80%

Revenue 1Y (TTM)-31.72%

Revenue growth 3Y49.98%

Revenue growth 5Y26.1%

Sales Q2Q%-38.36%

3.2 Future

LFT is expected to show a very negative growth in Earnings Per Share. In the coming years, the EPS will decrease by -22.01% yearly.
The Revenue is expected to decrease by -23.56% on average over the next years. This is quite bad

EPS Next Y-40.32%

EPS Next 2Y-22.01%

EPS Next 3YN/A

EPS Next 5YN/A

Revenue Next Year-34.75%

Revenue Next 2Y-23.56%

Revenue Next 3YN/A

Revenue Next 5YN/A

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 5.80 indicates a rather cheap valuation of LFT.
LFT's Price/Earnings ratio is rather cheap when compared to the industry. LFT is cheaper than 97.06% of the companies in the same industry.
LFT's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 28.39.
LFT is valuated cheaply with a Price/Forward Earnings ratio of 5.42.
95.59% of the companies in the same industry are more expensive than LFT, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 25.72, LFT is valued rather cheaply.

		Industry Rank	Sector Rank
PE	5.8
Fwd PE	5.42

4.2 Price Multiples

94.12% of the companies in the same industry are more expensive than LFT, based on the Price/Free Cash Flow ratio.

		Industry Rank	Sector Rank
P/FCF	5
EV/EBITDA	N/A

4.3 Compensation for Growth

LFT's earnings are expected to decrease with -22.01% in the coming years. This may justify a cheaper valuation.

PEG (NY)N/A

PEG (5Y)0.88

EPS Next 2Y-22.01%

EPS Next 3YN/A

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5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 9.60%, LFT is a good candidate for dividend investing.
LFT's Dividend Yield is slightly below the industry average, which is at 11.60.
LFT's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.

		Industry Rank	Sector Rank
Dividend Yield	9.6%

5.2 History

The dividend of LFT has a limited annual growth rate of 5.24%.
LFT has been paying a dividend for at least 10 years, so it has a reliable track record.
The dividend of LFT decreased in the last 3 years.

Dividend Growth(5Y)5.24%

Div Incr Years2

Div Non Decr Years2

5.3 Sustainability

LFT pays out 496.72% of its income as dividend. This is not a sustainable payout ratio.
The Dividend Rate of LFT has been growing, while earnings will be declining. This means the dividend growth is most likely not sustainable.

DP496.72%

EPS Next 2Y-22.01%

EPS Next 3YN/A

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LUMENT FINANCE TRUST INC / LFT FAQ

Can you provide the ChartMill fundamental rating for LUMENT FINANCE TRUST INC?

ChartMill assigns a fundamental rating of 4 / 10 to LFT.

What is the valuation status for LFT stock?

ChartMill assigns a valuation rating of 6 / 10 to LUMENT FINANCE TRUST INC (LFT). This can be considered as Fairly Valued.

How profitable is LUMENT FINANCE TRUST INC (LFT) stock?

LUMENT FINANCE TRUST INC (LFT) has a profitability rating of 5 / 10.

What are the PE and PB ratios of LUMENT FINANCE TRUST INC (LFT) stock?

The Price/Earnings (PE) ratio for LUMENT FINANCE TRUST INC (LFT) is 5.8 and the Price/Book (PB) ratio is 0.33.

Can you provide the dividend sustainability for LFT stock?

The dividend rating of LUMENT FINANCE TRUST INC (LFT) is 4 / 10 and the dividend payout ratio is 496.72%.