As of June 1, 2025, Schroder European Real Estate Investment Trust PLC has a Discounted Cash Flow (DCF) derived fair value of $108.85 per share. With the current market price at $67.40, this represents a potential upside of 61.5%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $89.34 |
| DCF Fair Value (10-year) | $108.85 |
| Potential Upside (5-year) | 32.6% |
| Potential Upside (10-year) | 61.5% |
| Discount Rate (WACC) | 7.5% - 10.1% |
Revenue is projected to grow from $21 million in 09-2024 to $39 million by 09-2034, representing a compound annual growth rate of approximately 6.4%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 09-2024 | 21 | 5% |
| 09-2025 | 26 | 24% |
| 09-2026 | 26 | 2% |
| 09-2027 | 27 | 4% |
| 09-2028 | 28 | 2% |
| 09-2029 | 29 | 6% |
| 09-2030 | 32 | 8% |
| 09-2031 | 33 | 4% |
| 09-2032 | 34 | 3% |
| 09-2033 | 36 | 6% |
| 09-2034 | 39 | 6% |
Net profit margin is expected to improve from 3% in 09-2024 to 6% by 09-2034, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 09-2024 | 1 | 3% |
| 09-2025 | 1 | 6% |
| 09-2026 | 1 | 6% |
| 09-2027 | 2 | 6% |
| 09-2028 | 2 | 6% |
| 09-2029 | 2 | 6% |
| 09-2030 | 2 | 6% |
| 09-2031 | 2 | 6% |
| 09-2032 | 2 | 6% |
| 09-2033 | 2 | 6% |
| 09-2034 | 2 | 6% |
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) |
|---|---|
| 09-2025 | 0 |
| 09-2026 | 0 |
| 09-2027 | 0 |
| 09-2028 | 0 |
| 09-2029 | 0 |
| 09-2030 | 0 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 76 |
| Days Inventory | 0 |
| Days Payables | 19 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 2025 | 14 | 0 | 0 | 0 | 14 |
| 2026 | 15 | 0 | 0 | 1 | 14 |
| 2027 | 15 | 0 | 0 | 0 | 15 |
| 2028 | 16 | 0 | 0 | (0) | 15 |
| 2029 | 16 | 0 | 0 | 0 | 16 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 89.34 | 32.6% |
| 10-Year DCF (Growth) | 108.85 | 61.5% |
| 5-Year DCF (EBITDA) | 95.47 | 41.6% |
| 10-Year DCF (EBITDA) | 114.51 | 69.9% |
Is Schroder European Real Estate Investment Trust PLC (SERE.L) a buy or a sell? Schroder European Real Estate Investment Trust PLC is definitely a buy. Based on our DCF analysis, Schroder European Real Estate Investment Trust PLC (SERE.L) appears to be significantly undervalued with upside potential of 61.5%. 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 strong buy at the current market price of $67.40.