Spirit Realty Capital Inc (SRC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:SRC - US84860W3007 - REIT
42.31 USD
-0.67 (-1.56%)
42.31 USD
0 (0%)
Taking everything into account, SRC scores 4 out of 10 in our fundamental rating. SRC was compared to 124 industry peers in the Diversified REITs industry. SRC has an excellent profitability rating, but there are concerns on its financial health. While showing a medium growth rate, SRC is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
- In the past year SRC was profitable.
- SRC had a positive operating cash flow in the past year.
1.2 Ratios
- SRC has a Return On Assets of 2.87%. This is in the better half of the industry: SRC outperforms 74.40% of its industry peers.
- Looking at the Return On Equity, with a value of 5.52%, SRC is in the better half of the industry, outperforming 76.00% of the companies in the same industry.
- Looking at the Return On Invested Capital, with a value of 3.14%, SRC is in the better half of the industry, outperforming 63.20% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for SRC is in line with the industry average of 3.05%.
- The 3 year average ROIC (2.96%) for SRC is below the current ROIC(3.14%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.87% | ||
| ROE | 5.52% | ||
| ROIC | 3.14% |
ROA(3y)1.89%
ROA(5y)2.17%
ROE(3y)3.49%
ROE(5y)3.92%
ROIC(3y)2.96%
ROIC(5y)3.19%
1.3 Margins
- With an excellent Profit Margin value of 32.87%, SRC belongs to the best of the industry, outperforming 87.20% of the companies in the same industry.
- In the last couple of years the Profit Margin of SRC has grown nicely.
- SRC has a Operating Margin of 44.35%. This is amongst the best in the industry. SRC outperforms 88.80% of its industry peers.
- In the last couple of years the Operating Margin of SRC has grown nicely.
- Looking at the Gross Margin, with a value of 95.85%, SRC belongs to the top of the industry, outperforming 96.00% of the companies in the same industry.
- In the last couple of years the Gross Margin of SRC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 44.35% | ||
| PM (TTM) | 32.87% | ||
| GM | 95.85% |
OM growth 3Y-3.89%
OM growth 5Y2.83%
PM growth 3Y6.81%
PM growth 5Y17.76%
GM growth 3Y-0.21%
GM growth 5Y0.51%
2. Health
2.1 Basic Checks
- SRC has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
- Compared to 1 year ago, SRC has more shares outstanding
- Compared to 1 year ago, SRC has a worse debt to assets ratio.
2.2 Solvency
- Based on the Altman-Z score of 0.58, we must say that SRC is in the distress zone and has some risk of bankruptcy.
- With a Altman-Z score value of 0.58, SRC perfoms like the industry average, outperforming 49.60% of the companies in the same industry.
- A Debt/Equity ratio of 0.85 indicates that SRC is somewhat dependend on debt financing.
- SRC's Debt to Equity ratio of 0.85 is fine compared to the rest of the industry. SRC outperforms 64.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.85 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.58 |
ROIC/WACC0.45
WACC6.93%
2.3 Liquidity
- SRC has a Current Ratio of 0.61. This is a bad value and indicates that SRC is not financially healthy enough and could expect problems in meeting its short term obligations.
- SRC's Current ratio of 0.61 is on the low side compared to the rest of the industry. SRC is outperformed by 77.60% of its industry peers.
- A Quick Ratio of 0.58 indicates that SRC may have some problems paying its short term obligations.
- Looking at the Quick ratio, with a value of 0.58, SRC is doing worse than 77.60% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.61 | ||
| Quick Ratio | 0.58 |
3. Growth
3.1 Past
- SRC shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -7.41%.
- The Earnings Per Share has been growing by 20.59% on average over the past years. This is a very strong growth
- The Revenue has grown by 10.57% in the past year. This is quite good.
- The Revenue has been growing by 10.47% on average over the past years. This is quite good.
EPS 1Y (TTM)-7.41%
EPS 3Y1%
EPS 5Y20.59%
EPS Q2Q%-53.7%
Revenue 1Y (TTM)10.57%
Revenue growth 3Y11.18%
Revenue growth 5Y10.47%
Sales Q2Q%5.74%
3.2 Future
- The Earnings Per Share is expected to decrease by -7.61% on average over the next years.
- The Revenue is expected to grow by 6.45% on average over the next years.
EPS Next Y-16.82%
EPS Next 2Y-17.44%
EPS Next 3Y-10.67%
EPS Next 5Y-7.61%
Revenue Next Year7.73%
Revenue Next 2Y5.01%
Revenue Next 3Y4.5%
Revenue Next 5Y6.45%
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.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 24.18, SRC is valued on the expensive side.
- SRC's Price/Earnings ratio is a bit cheaper when compared to the industry. SRC is cheaper than 70.40% of the companies in the same industry.
- SRC's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.21.
- A Price/Forward Earnings ratio of 30.43 indicates a quite expensive valuation of SRC.
- SRC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. SRC is cheaper than 76.00% of the companies in the same industry.
- SRC is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 25.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.18 | ||
| Fwd PE | 30.43 |
4.2 Price Multiples
- SRC's Enterprise Value to EBITDA ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 14.94 |
4.3 Compensation for Growth
- SRC has a very decent profitability rating, which may justify a higher PE ratio.
- A cheap valuation may be justified as SRC's earnings are expected to decrease with -10.67% in the coming years.
PEG (NY)N/A
PEG (5Y)1.17
EPS Next 2Y-17.44%
EPS Next 3Y-10.67%
5. Dividend
5.1 Amount
- SRC has a Yearly Dividend Yield of 6.33%, which is a nice return.
- Compared to an average industry Dividend Yield of 6.82, SRC pays a bit more dividend than its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.81, SRC pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.33% |
5.2 History
- The dividend of SRC decreases each year by -6.14%.
- SRC has paid a dividend for at least 10 years, which is a reliable track record.
- SRC has decreased its dividend recently.
Dividend Growth(5Y)-6.14%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
- SRC pays out 154.84% of its income as dividend. This is not a sustainable payout ratio.
- The Dividend Rate of SRC has been decling, while earnings will also be declining. This means the current dividend is most likely not sustainable.
DP154.84%
EPS Next 2Y-17.44%
EPS Next 3Y-10.67%
Spirit Realty Capital Inc / SRC FAQ
Can you provide the ChartMill fundamental rating for Spirit Realty Capital Inc?
ChartMill assigns a fundamental rating of 4 / 10 to SRC.
What is the valuation status of Spirit Realty Capital Inc (SRC) stock?
ChartMill assigns a valuation rating of 2 / 10 to Spirit Realty Capital Inc (SRC). This can be considered as Overvalued.
What is the profitability of SRC stock?
Spirit Realty Capital Inc (SRC) has a profitability rating of 8 / 10.
Can you provide the financial health for SRC stock?
The financial health rating of Spirit Realty Capital Inc (SRC) is 1 / 10.
What is the earnings growth outlook for Spirit Realty Capital Inc?
The Earnings per Share (EPS) of Spirit Realty Capital Inc (SRC) is expected to decline by -16.82% in the next year.