Overall, Realty Income demonstrates high business quality through its solid track record, diversified portfolio, and strong financial position. However, it faces challenges related to tenant credit quality and potential income volatility. Looking forward, the company has promising growth prospects, with a robust investment pipeline and effective capital recycling strategies, despite some uncertainties regarding tenant retention and economic conditions.
Analysis Date: February 25, 2025
Last Updated: March 12, 2025
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Graham Value Metrics
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$12.36
Current Market Price: $56.49
IV/P Ratio: 0.22x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
-357.0%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
ROE: 2.2184682692210673
ROA: 0.28998603458334643
Gross Profit Margin: 72.24250670585491
Net Profit Margin: 16.2757990584386
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Strong Gross and Operating Profit Margins
0.7224
Gross Profit Margin
0.6908
Operating Profit Margin
With a gross profit margin of 72.24% and an operating profit margin of 69.08%, the company demonstrates strong operational efficiency and ability to convert sales into profits.
Low Return on Equity
The return on equity of 2.22% is quite low, suggesting that the company is not effectively using its equity base to generate profits.
About Profitability Metrics
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
2.22%
10%
15%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-16)
Return on Assets (ROA)
Measures how efficiently a company uses its assets to generate profits
0.29%
3%
7%
Higher values indicate better asset utilization
TTM (as of 2025-04-16)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
72.24%
20%
40%
Higher values indicate better efficiency in production
TTM (as of 2025-04-16)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
16.28%
8%
15%
Higher values indicate better overall profitability
TTM (as of 2025-04-16)
Strong Liquidity Ratios
The current ratio of 1.68 and quick ratio of 1.68 indicate that the company has adequate short-term assets to cover its short-term liabilities, reflecting good liquidity.
Manageable Debt Levels
0.6889
Debt-to-Equity Ratio
A debt-to-equity ratio of 0.69 indicates a balanced approach to leveraging, suggesting that the company is not overly reliant on debt for financing.
Low Cash Ratio
A cash ratio of 0.19 indicates limited cash reserves relative to current liabilities, which could signal potential liquidity issues in times of financial stress.
About Financial Health Metrics
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
0.69x
1.0x
2.0x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q4 2024
Current Ratio
Current assets divided by current liabilities
1.68x
1.0x
2.0x
Higher values indicate better short-term liquidity
Less than 1.0 is concerning, 1.0-2.0 is adequate, greater than 2.0 is good
Q4 2024
