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Rexford Industrial Realty, Inc. (NYSE:REXR), which is in the reits business, and is based in United States, saw a decent share price growth in the teens level on the NYSE over the last few months. As a US$4.0b market cap stock, it seems odd Rexford Industrial Realty is not more well-covered by analysts. However, this is not necessarily a bad thing given that there are less eyes on the stock to push it closer to fair value. Is there still an opportunity to buy? Today I will analyse the most recent data on Rexford Industrial Realty’s outlook and valuation to see if the opportunity still exists.
What is Rexford Industrial Realty worth?
The stock seems fairly valued at the moment according to my valuation model. It’s trading around 7.4% below my intrinsic value, which means if you buy Rexford Industrial Realty today, you’d be paying a fair price for it. And if you believe the company’s true value is $40.82, then there isn’t much room for the share price grow beyond what it’s currently trading. Furthermore, Rexford Industrial Realty’s low beta implies that the stock is less volatile than the wider market.
Can we expect growth from Rexford Industrial Realty?
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 Rexford Industrial Realty, it is expected to deliver a highly negative earnings growth in the upcoming, 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? REXR seems fairly priced right now, but given the uncertainty from negative returns in the future, this could be the right time to de-risk your portfolio. Is your current exposure to the stock optimal for your total portfolio? And is the opportunity cost of holding a negative-outlook stock too high? Before you make a decision on the stock, take a look at whether its fundamentals have changed.
Are you a potential investor? If you’ve been keeping tabs on REXR for a while, now may not be the most advantageous time to buy, given it is trading around its fair value. The price seems to be trading at fair value, which means there’s less benefit from mispricing. Furthermore, the negative growth outlook increases the risk of holding the stock. However, there are also other important factors we haven’t considered today, which can help gel your views on REXR should the price fluctuate below its true value.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Rexford Industrial Realty. You can find everything you need to know about Rexford Industrial Realty in the latest infographic research report. If you are no longer interested in Rexford Industrial Realty, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
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.
If you spot an error that warrants correction, please contact the editor at email@example.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. Thank you for reading.