Yahoo Finance Should You Investigate Vornado Realty Trust (NYSE:VNO) At US$66.40?
Today we're going to take a look at the well-established Vornado Realty Trust (NYSE:VNO). The company's stock saw its share price hover around a small range of US$63.09 to US$68.61 over the last few weeks. But is this actually reflective of the share value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Vornado Realty Trust’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
See our latest analysis for Vornado Realty Trust
What is Vornado Realty Trust worth?
Vornado Realty Trust appears to be overvalued by 24% at the moment, based on my discounted cash flow valuation. The stock is currently priced at US$66.40 on the market compared to my intrinsic value of $53.38. Not the best news for investors looking to buy! Furthermore, Vornado Realty Trust’s share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. If you believe the share price should eventually reach its true value, a low beta could suggest it is unlikely to rapidly do so anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range.
What does the future of Vornado Realty Trust look like?
Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. Though in the case of Vornado Realty Trust, it is expected to deliver a highly negative earnings growth in the next few years, which doesn’t help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term.
What this means for you:
Are you a shareholder? If you believe VNO is currently trading above its value, selling high and buying it back up again when its price falls towards its real value can be profitable. Given the uncertainty from negative growth in the future, this could be the right time to de-risk your portfolio. But before you make this decision, take a look at whether its fundamentals have changed.
Are you a potential investor? If you’ve been keeping an eye on VNO for a while, now may not be the best time to enter into the stock. Price climbed passed its true value, in addition to a risky future outlook. However, there are also other important factors which we haven’t considered today, such as the track record of its management. Should the price fall in the future, will you be well-informed enough to buy?
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Vornado Realty Trust. You can find everything you need to know about Vornado Realty Trust in the latest infographic research report. If you are no longer interested in Vornado Realty Trust, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
