TPG RE FINANCE TRUST INC (TRTX) Stock Fundamental Analysis
NYSE:TRTX - New York Stock Exchange, Inc. - US87266M1071 - REIT - Currency: USD
We assign a fundamental rating of 6 out of 10 to TRTX. TRTX was compared to 65 industry peers in the Mortgage Real Estate Investment Trusts (REITs)" industry. While TRTX has a great profitability rating, there are some minor concerns on its financial health. TRTX is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
TRTX had positive earnings in the past year.
In the past year TRTX had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: TRTX reported negative net income in multiple years.
Each year in the past 5 years TRTX had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 1.43%, TRTX belongs to the top of the industry, outperforming 89.23% of the companies in the same industry.
Looking at the Return On Equity, with a value of 5.13%, TRTX is in the better half of the industry, outperforming 78.46% of the companies in the same industry.
TRTX has a better Return On Invested Capital (5.27%) than 95.38% of its industry peers.
TRTX had an Average Return On Invested Capital over the past 3 years of 5.39%. This is above the industry average of 1.42%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.43% | ||
| ROE | 5.13% | ||
| ROIC | 5.27% |
ROA(3y)-0.94%
ROA(5y)-0.93%
ROE(3y)-3.95%
ROE(5y)-3.53%
ROIC(3y)5.39%
ROIC(5y)4.65%
1.3 Margins
With an excellent Profit Margin value of 16.75%, TRTX belongs to the best of the industry, outperforming 84.62% of the companies in the same industry.
In the last couple of years the Profit Margin of TRTX has declined.
The Operating Margin of TRTX (77.32%) is better than 98.46% of its industry peers.
TRTX's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 91.75%, TRTX belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
TRTX's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 77.32% | ||
| PM (TTM) | 16.75% | ||
| GM | 91.75% |
OM growth 3Y-2.13%
OM growth 5Y-2.23%
PM growth 3Y-16.74%
PM growth 5Y-14.35%
GM growth 3Y1.36%
GM growth 5Y0.46%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), TRTX is destroying value.
The number of shares outstanding for TRTX has been increased compared to 1 year ago.
Compared to 5 years ago, TRTX has more shares outstanding
Compared to 1 year ago, TRTX has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 0.32, we must say that TRTX is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of TRTX (0.32) is better than 84.62% of its industry peers.
TRTX has a debt to FCF ratio of 31.44. This is a negative value and a sign of low solvency as TRTX would need 31.44 years to pay back of all of its debts.
TRTX has a better Debt to FCF ratio (31.44) than 78.46% of its industry peers.
TRTX has a Debt/Equity ratio of 2.55. This is a high value indicating a heavy dependency on external financing.
TRTX's Debt to Equity ratio of 2.55 is fine compared to the rest of the industry. TRTX outperforms 73.85% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.55 | ||
| Debt/FCF | 31.44 | ||
| Altman-Z | 0.32 |
ROIC/WACC0.72
WACC7.34%
2.3 Liquidity
A Current Ratio of 8.70 indicates that TRTX has no problem at all paying its short term obligations.
TRTX has a Current ratio of 8.70. This is amongst the best in the industry. TRTX outperforms 95.38% of its industry peers.
TRTX has a Quick Ratio of 8.70. This indicates that TRTX is financially healthy and has no problem in meeting its short term obligations.
TRTX has a better Quick ratio (8.70) than 95.38% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 8.7 | ||
| Quick Ratio | 8.7 |
3. Growth
3.1 Past
TRTX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 127.61%, which is quite impressive.
TRTX shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -11.01% yearly.
The Revenue for TRTX has decreased by -13.22% in the past year. This is quite bad
TRTX shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.60% yearly.
EPS 1Y (TTM)127.61%
EPS 3Y-4.44%
EPS 5Y-11.01%
EPS Q2Q%-20%
Revenue 1Y (TTM)-13.22%
Revenue growth 3Y13.5%
Revenue growth 5Y0.6%
Sales Q2Q%-7.09%
3.2 Future
TRTX is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.97% yearly.
Based on estimates for the next years, TRTX will show a small growth in Revenue. The Revenue will grow by 0.34% on average per year.
EPS Next Y4.34%
EPS Next 2Y7.37%
EPS Next 3Y5.97%
EPS Next 5YN/A
Revenue Next Year5.33%
Revenue Next 2Y7.25%
Revenue Next 3Y0.34%
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 accelerating.
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
TRTX is valuated reasonably with a Price/Earnings ratio of 8.98.
TRTX's Price/Earnings ratio is a bit cheaper when compared to the industry. TRTX is cheaper than 75.38% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.28, TRTX is valued rather cheaply.
TRTX is valuated cheaply with a Price/Forward Earnings ratio of 7.30.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TRTX indicates a somewhat cheap valuation: TRTX is cheaper than 76.92% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of TRTX to the average of the S&P500 Index (21.76), we can say TRTX is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.98 | ||
| Fwd PE | 7.3 |
4.2 Price Multiples
100.00% of the companies in the same industry are more expensive than TRTX, based on the Enterprise Value to EBITDA ratio.
80.00% of the companies in the same industry are more expensive than TRTX, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.21 | ||
| EV/EBITDA | 11.17 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
TRTX has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.07
PEG (5Y)N/A
EPS Next 2Y7.37%
EPS Next 3Y5.97%
5. Dividend
5.1 Amount
TRTX has a Yearly Dividend Yield of 8.90%, which is a nice return.
Compared to an average industry Dividend Yield of 11.56, TRTX is paying slightly less dividend.
TRTX's Dividend Yield is rather good when compared to the S&P500 average which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.9% |
5.2 History
The dividend of TRTX decreases each year by -8.14%.
TRTX has been paying a dividend for over 5 years, so it has already some track record.
TRTX has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-8.14%
Div Incr Years1
Div Non Decr Years3
5.3 Sustainability
161.31% of the earnings are spent on dividend by TRTX. This is not a sustainable payout ratio.
DP161.31%
EPS Next 2Y7.37%
EPS Next 3Y5.97%
8.08
+0.22 (+2.8%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryMortgage Real Estate Investment Trusts (REITs)"
Earnings (Last)
Earnings (Next)
Inst Owners75.08%
Inst Owner Change-1.81%
Ins Owners3.14%
Ins Owner Change0.04%
Market Cap645.27M
Analysts80
Price Target9.69 (19.93%)
Short Float %5.37%
Short Ratio5.78
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.9% |
Yearly Dividend1.14
Dividend Growth(5Y)-8.14%
DP161.31%
Div Incr Years1
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-35.18%
Min EPS beat(2)-63%
Max EPS beat(2)-7.36%
EPS beat(4)2
Avg EPS beat(4)-14.85%
Min EPS beat(4)-63%
Max EPS beat(4)10.54%
EPS beat(8)3
Avg EPS beat(8)-229.27%
EPS beat(12)4
Avg EPS beat(12)-155.05%
EPS beat(16)6
Avg EPS beat(16)-118.25%
Revenue beat(2)0
Avg Revenue beat(2)-8.92%
Min Revenue beat(2)-15.5%
Max Revenue beat(2)-2.35%
Revenue beat(4)1
Avg Revenue beat(4)-4.59%
Min Revenue beat(4)-15.5%
Max Revenue beat(4)6.99%
Revenue beat(8)2
Avg Revenue beat(8)-5.86%
Revenue beat(12)5
Avg Revenue beat(12)25.13%
Revenue beat(16)9
Avg Revenue beat(16)34.22%
PT rev (1m)0%
PT rev (3m)-5%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-6.05%
EPS NY rev (1m)0%
EPS NY rev (3m)-9.35%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.2%
Revenue NY rev (1m)0%
Revenue NY rev (3m)1.65%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.98 | ||
| Fwd PE | 7.3 | ||
| P/S | 1.91 | ||
| P/FCF | 7.21 | ||
| P/OCF | 6.87 | ||
| P/B | 0.58 | ||
| P/tB | 0.6 | ||
| EV/EBITDA | 11.17 |
EPS(TTM)0.9
EY11.14%
EPS(NY)1.11
Fwd EY13.7%
FCF(TTM)1.12
FCFY13.86%
OCF(TTM)1.18
OCFY14.55%
SpS4.23
BVpS13.82
TBVpS13.57
PEG (NY)2.07
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.43% | ||
| ROE | 5.13% | ||
| ROCE | 6.67% | ||
| ROIC | 5.27% | ||
| ROICexc | 5.81% | ||
| ROICexgc | 5.87% | ||
| OM | 77.32% | ||
| PM (TTM) | 16.75% | ||
| GM | 91.75% | ||
| FCFM | 26.48% |
ROA(3y)-0.94%
ROA(5y)-0.93%
ROE(3y)-3.95%
ROE(5y)-3.53%
ROIC(3y)5.39%
ROIC(5y)4.65%
ROICexc(3y)5.67%
ROICexc(5y)4.9%
ROICexgc(3y)5.74%
ROICexgc(5y)4.97%
ROCE(3y)6.82%
ROCE(5y)5.88%
ROICexcg growth 3Y24.39%
ROICexcg growth 5Y8.93%
ROICexc growth 3Y24.45%
ROICexc growth 5Y8.68%
OM growth 3Y-2.13%
OM growth 5Y-2.23%
PM growth 3Y-16.74%
PM growth 5Y-14.35%
GM growth 3Y1.36%
GM growth 5Y0.46%
F-Score5
Asset Turnover0.09
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.55 | ||
| Debt/FCF | 31.44 | ||
| Debt/EBITDA | 10.15 | ||
| Cap/Depr | 28.22% | ||
| Cap/Sales | 1.31% | ||
| Interest Coverage | 1.43 | ||
| Cash Conversion | 33.9% | ||
| Profit Quality | 158.13% | ||
| Current Ratio | 8.7 | ||
| Quick Ratio | 8.7 | ||
| Altman-Z | 0.32 |
F-Score5
WACC7.34%
ROIC/WACC0.72
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)1.52%
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)127.61%
EPS 3Y-4.44%
EPS 5Y-11.01%
EPS Q2Q%-20%
EPS Next Y4.34%
EPS Next 2Y7.37%
EPS Next 3Y5.97%
EPS Next 5YN/A
Revenue 1Y (TTM)-13.22%
Revenue growth 3Y13.5%
Revenue growth 5Y0.6%
Sales Q2Q%-7.09%
Revenue Next Year5.33%
Revenue Next 2Y7.25%
Revenue Next 3Y0.34%
Revenue Next 5YN/A
EBIT growth 1Y-21.31%
EBIT growth 3Y11.09%
EBIT growth 5Y-1.64%
EBIT Next Year37.6%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y3.65%
FCF growth 3Y-6.86%
FCF growth 5Y-2.58%
OCF growth 1Y2.73%
OCF growth 3Y-5.34%
OCF growth 5Y-1.62%