Friday, November 30, 2018

Unibail Rodamco Westfield intrinsic value

Unibail Rodamco merged with Westfield and financed the deal by selling 38? million shares, so the share count has increased from 100m to roughly 140m. I haven't seen the balance sheet or P&L since the merger / stapling? of stocks.
The business is retail real estate so investors might be afraid of the long-term results...

Usually, the Benjamin Graham number is the geometric average of 15x Earnings and 1,5x book value. For real estate 1,5x book might lead to a too high valuation so I have used 1x book.
Earnings are a mix of revaluation and income, so you could also say the EPS will be 12,90 Eur this year...

Graham Number = 260 Euro = Square Root ( 15 x 25 EPS x 1 x Book 200 )

Dividend = 10,8 / 150 = 7% and increasing.

Conclusion: As of November 2018 Unibail Rodamco Westfield looks like a buy. Not my circle of competence.

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