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Is Kilroy Realty Corporation (NYSE:KRC) Potentially Undervalued?

Simply Wall St

Kilroy Realty Corporation (NYSE:KRC), which is in the reits business, and is based in United States, had a relatively subdued couple of weeks in terms of changes in share price, which continued to float around the range of US$80.74 to US$88.28. However, is this the true valuation level of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Kilroy Realty’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

Check out our latest analysis for Kilroy Realty

What's the opportunity in Kilroy Realty?

Good news, investors! Kilroy Realty is still a bargain right now. My valuation model shows that the intrinsic value for the stock is $112.03, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Another thing to keep in mind is that Kilroy Realty’s share price may be quite stable relative to the rest of the market, as indicated by its low beta. This means that if you believe the current share price should move towards its intrinsic value over time, a low beta could suggest it is not likely to reach that level anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range again.

What does the future of Kilroy Realty look like?

NYSE:KRC Past and Future Earnings, February 20th 2020

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. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. Though in the case of Kilroy Realty, it is expected to deliver a relatively unexciting earnings growth of 7.2%, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term.

What this means for you:

Are you a shareholder? Even though growth is relatively muted, since KRC is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on KRC for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy KRC. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed buy.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Kilroy Realty. You can find everything you need to know about Kilroy Realty in the latest infographic research report. If you are no longer interested in Kilroy Realty, 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.