Rechecking SL Green Realty (SLG) Valuation After Recent Share Price Weakness And Perceived Undervaluation
Why SL Green Realty Stock Is Back in Focus
SL Green Realty (SLG) is drawing fresh attention after a stretch of weak share performance, with the stock showing negative returns over the past week, month, past 3 months and year.
See our latest analysis for SL Green Realty.
At the current share price of $39.54, SL Green Realty’s recent 1 month share price return of 18.59% decline and 1 year total shareholder return of 37.14% decline point to fading momentum after a stronger 3 year total shareholder return of 33.39%.
If this weakness has you looking around the market, it could be a good moment to hunt for opportunities in high quality property owners and operators alongside a broader group of 23 top founder-led companies.
With SL Green trading at $39.54 and sitting at a 31% discount to the average analyst price target and a smaller 8% intrinsic discount, the key question is whether this represents a mispriced recovery story or whether the market is already factoring in future growth.
Most Popular Narrative: 23.7% Undervalued
SL Green Realty’s most followed narrative pegs fair value at about $51.83, comfortably above the last close of $39.54. This is why many investors are re-checking the underlying story rather than just the recent share price weakness.
Portfolio optimization and disciplined capital recycling, including strategic dispositions and realizing significant gains on debt and preferred equity investments, are strengthening liquidity, setting the stage for new accretive investments, and reducing interest expense to enhance future earnings growth.
Curious what has to happen for that higher value to make sense? The narrative leans on shifting revenue expectations, margin rebuilding, and a rich future earnings multiple that might surprise you.
Result: Fair Value of $51.83 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, you still need to factor in risks like persistent high interest costs and uncertain lease rollovers, which could pressure margins and challenge the earnings narrative.
Find out about the key risks to this SL Green Realty narrative.
Next Steps
If this combination of caution and optimism around SL Green has you undecided, take a closer look at the data now, including our breakdown of 2 key rewards and 2 important warning signs.
Looking for more investment ideas?
If SL Green has you thinking harder about where your money is working hardest, do not stop here. Broaden your watchlist and let the data do more of the heavy lifting.
- Target reliability first and check out 80 resilient stocks with low risk scores that may offer a smoother ride when markets feel choppy.
- Hunt for value by scanning 56 high quality undervalued stocks where quality fundamentals meet prices that look out of step with underlying numbers.
- Build your income shortlist with 13 dividend fortresses that combine higher yields with a focus on resilience.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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