As of May 27, 2025, Cominar REIT has a Discounted Cash Flow (DCF) derived fair value of $13.21 per share. With the current market price at $11.74, this represents a potential upside of 12.5%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $10.92 |
| DCF Fair Value (10-year) | $13.21 |
| Potential Upside (5-year) | -7.0% |
| Potential Upside (10-year) | 12.5% |
| Discount Rate (WACC) | 5.8% - 9.5% |
Revenue is projected to grow from $661 million in 12-2020 to $914 million by 12-2030, representing a compound annual growth rate of approximately 3.3%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2020 | 661 | 6% |
| 12-2021 | 678 | 3% |
| 12-2022 | 688 | 1% |
| 12-2023 | 719 | 5% |
| 12-2024 | 752 | 5% |
| 12-2025 | 780 | 4% |
| 12-2026 | 831 | 7% |
| 12-2027 | 861 | 4% |
| 12-2028 | 878 | 2% |
| 12-2029 | 896 | 2% |
| 12-2030 | 914 | 2% |
Net profit margin is expected to improve from -50% in 12-2020 to -50% by 12-2030, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2020 | (329) | -50% |
| 12-2021 | (337) | -50% |
| 12-2022 | (342) | -50% |
| 12-2023 | (358) | -50% |
| 12-2024 | (374) | -50% |
| 12-2025 | (388) | -50% |
| 12-2026 | (414) | -50% |
| 12-2027 | (428) | -50% |
| 12-2028 | (437) | -50% |
| 12-2029 | (446) | -50% |
| 12-2030 | (455) | -50% |
with a 5-year average of $0 million. Projected CapEx is expected to maintain at approximately 0% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2021 | 0 |
| 12-2022 | 0 |
| 12-2023 | 0 |
| 12-2024 | 0 |
| 12-2025 | 0 |
| 12-2026 | 0 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 12 |
| Days Inventory | 0 |
| Days Payables | 4 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 3M/2021 | 74 | (0) | 0 | (1) | 75 |
| 2022 | 301 | (0) | 0 | 1 | 300 |
| 2023 | 315 | (0) | 0 | 2 | 313 |
| 2024 | 329 | (0) | 0 | (0) | 330 |
| 2025 | 341 | (0) | 0 | 1 | 341 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 10.92 | -7.0% |
| 10-Year DCF (Growth) | 13.21 | 12.5% |
| 5-Year DCF (EBITDA) | 1.16 | -90.2% |
| 10-Year DCF (EBITDA) | 5.12 | -56.4% |
Is Cominar REIT (CUF.UN.TO) a buy or a sell? Cominar REIT is definitely a buy. Based on our DCF analysis, Cominar REIT (CUF.UN.TO) appears to be moderately undervalued with upside potential of 12.5%. The company's strong projected growth in revenue and profitability, coupled with consistent capital expenditure, supports our positive outlook on its intrinsic value.
Key investment drivers include:
Investors should consider a buy at the current market price of $11.74.