AP-UN.TO  Allied Properties Real Estate

Exchange

TSX

Sector

Diversified Industries

Industry

Market Cap.

3.48B

Vuru Grade

23.90/100

Current Price

$40.89
-0.12 (-0.29%)

Growth Price

$9.53
Overvalued by 76.69%

Company Metrics

  • P/E 8.38
  • P/S 8.58
  • P/B 1.1
  • EPS 4.88
  • Cash ROIC -6.37%
  • Cash Ratio -
  • Dividend 1.23 / 4.03%
  • Avg. Vol. 190,496.00
  • Shares 85.11M
  • Market Cap. 3.48B

Company Description

Allied Properties Real Estate Investment Trust operates as an unincorporated closed-end real estate investment trust in Canada. The company, through its subsidiaries, provides Class I office space in the urban areas of Toronto, Montreal, Winnipeg, Quebec City, and Kitchener. It also provides property management and related services. The company serves various business tenants, including a range of... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

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Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for AP-UN.TO to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate AP-UN.TO's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$40.89 Current Price

$9.53 Growth Price (DCF)

Overvalued by 76.69%


Growth Rate Assumed by Market: 500.00%


Future Free Cash Flow Growth Rate: 0.0%


Discount Rate: 15.0%


AP-UN.TO's most recent year of (normalized) free cash flow is negative. This is the base number for forward projections. This means that if you increase the growth rate, the amount of negative FCF grows, thereby decreasing the price.

Show Free Cash Flow numbers

Very Poor Cash Return on Invested Capital over the past 5 years

AP-UN.TO has failed to generate positive returns on its investments in buildings, projects and equipment. This could be due to poor management, lack of an economic moat or the capital intensive nature of the business.

AP-UN.TO has lost $6.37 of cash for every $100 invested.
Figures in CAD. Fiscal year ends in December
20122013201420152016
Free Cash Flow -291.21M -194.63M -259.18M -159.05M -342.47M
divided by
Invested Capital 3.05B 3.50B 3.93B 4.46B 5.21B
Cash ROIC -9.54% -5.56% -6.59% -3.57% -6.57%

Shrinking Return on Equity over the past 5 years

AP-UN.TO has been shrinking returns with capital that shareholders have invested. This is a negative sign and demonstrates that both the business and management performance are weakening over time.

AP-UN.TO has generated $10.97 of Earnings for every $100 of Shareholders' Equity.
Figures in CAD. Fiscal year ends in December
20122013201420152016
Net Income 369.82M 238.62M 151.78M 136.93M 324.31M
divided by
Stockholders' Equity 1.78B 2.07B 2.33B 2.59B 3.02B
Return on Equity 20.80% 11.53% 6.51% 5.28% 10.73%

Poor Business Performance over the past 10 years

AP-UN.TO's inability to produce positive free cash flow for the majority of the past 10 years is concerning. It should be a red flag, since this company does not have a track record of delivering results for shareholders. This could be due to poor management or the nature of its business.

AP-UN.TO has been losing money for the majority of the past 10 years.
Figures in CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Free Cash Flow 9.00M -95.46M -159.30M 30.98M -267.01M -291.21M -194.63M -259.18M -159.05M -342.47M

Good Balance Sheet

AP-UN.TO's Total Assets double Total Liabilities. Its financial position is adequate. Remember to check Shareholders' Equity to see if it's stable or growing. It's one of the best measures of whether a company is creating value for shareholders.
Figures in CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Cash - - - - - - - - - -
Current Assets - - - - - - - - - -
Total Assets 808.63M 949.39M 1.16B 1.26B 2.15B 3.05B 3.50B 3.93B 4.46B 5.21B
Current Liabilities - - - - - - - - - -
Total Liabilities 518.76M 563.73M 673.63M 748.52M 1.01B 1.27B 1.43B 1.60B 1.86B 2.19B
Stockholder' Equity 289.87M 385.65M 481.53M 509.99M 1.14B 1.78B 2.07B 2.33B 2.59B 3.02B
Current Ratio - - - - - - - - - -
TL-to-TA 0.64 0.59 0.58 0.59 0.47 0.42 0.41 0.41 0.42 0.42

Consistent Reinvestment of Profits over the past 10 years

AP-UN.TO has consistently retained profits. This may put AP-UN.TO in a strong position to invest for the future, by buying new machinery, investing in R&D or a number of other options. By effectively using these earnings, AP-UN.TO can greatly improve their long-term economic picture.
Figures in CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Retained Earnings -54.10M -80.29M -107.75M -142.01M - 370.28M 516.78M 567.97M 709.41M 911.83M
Retained Earnings Growth - -48.41% -34.21% -31.79% 100.00% - 39.57% 9.91% 24.90% 28.53%

Erratic Net Profit Margins over the past 10 years

AP-UN.TO has had highly erratic net profit margins which are a great cause for concern. This company may operate in a highly volatile industry, or it may just have poor performance. Look at reasons for this inconsistency to understand if there is any reason to look past it.
Figures in CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Net Income 5.81M 12.51M 16.30M 18.54M 158.66M 369.82M 238.62M 151.78M 136.93M 324.31M
divided by
Revenue 106.91M 132.47M 152.80M 184.47M 196.49M 258.39M 302.03M 337.71M 365.40M 389.72M
Net Profit Margin 5.43% 9.45% 10.67% 10.05% 80.75% 143.12% 79.01% 44.94% 37.47% 83.21%

Weak Pricing Power over the past 10 years

AP-UN.TO is likely in a highly competitive industry, due to low barriers to entry. It's because of this, that AP-UN.TO has been unable to raise prices and increase their profitability. This puts them in a poor position if inflation becomes an issue, as they would struggle to pass higher costs onto consumers.

Only $- of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Gross Profit - - - - - - - - - -
divided by
Revenue 106.91M 132.47M 152.80M 184.47M 196.49M 258.39M 302.03M 337.71M 365.40M 389.72M
Gross Margin - - - - - - - - - -

High Capital Intensity over the past 10 years

AP-UN.TO spends large amounts of capital buying new equipment or investing in new facilities to stay competitive. Over the long term, those costs may have to be fuelled by debt. Look at the growth of Shareholders' Equity to see if this strategy is having a positive or negative impact.

396.54% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Capital Expenditure 7.69M 147.85M 222.31M 30.41M 345.31M 403.05M 317.42M 385.43M 348.35M 503.71M
divided by
Net Income 5.81M 12.51M 16.30M 18.54M 158.66M 369.82M 238.62M 151.78M 136.93M 324.31M
Capital Expenditure Ratio 132.39% 1,181.64% 1,363.96% 164.05% 217.64% 108.99% 133.02% 253.94% 254.40% 155.32%

Very Strong Dividend History over the past 10 years

AP-UN.TO has consistently distributed a dividend for at least the past 10 years. Such a long dividend history suggests AP-UN.TO is very established in its market and that its dividend distribution is likely to continue for a significant period of time.
Figures in CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Dividend Paid 27.27M 32.36M 40.11M 45.44M 47.88M 56.33M 69.36M 71.29M 77.80M 115.04M
divided by
Shares Outstanding 23.76M 29.60M 33.28M 40.09M 47.70M 57.11M 67.89M 71.32M 77.77M 80.94M
Dividend Paid Per Share 1.14 1.08 1.20 1.12 1.00 0.98 1.01 0.99 0.99 1.41
Price at Year End - - - - - - - 37.50 31.98 35.95
Dividend Yield - - - - - - - 2.64% 3.10% 3.92%

No History of Stock Buybacks over the past 10 years

We're neutral on this. It's not necessarily good or bad that AP-UN.TO hasn't initiated a stock buyback.
Figures in CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Shares Outstanding 23.76M 29.60M 33.28M 40.09M 47.70M 57.11M 67.89M 71.32M 77.77M 80.94M
Stock Bought Back - -19.75% -11.05% -16.98% -15.95% -16.49% -15.87% -4.81% -8.30% -3.91%
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