DCF Tool

KREF

KKR Real Estate Finance Trust Inc – Offices of Real Estate Agents and Brokers
kkr real estate finance trust inc., a mortgage real estate investment trust, focuses primarily on originating and acquiring senior loans secured by commercial real estate (cre) assets. the company engages in the origination and purchase of credit investments related to cre, including leveraged and unleveraged commercial mortgage loans, and commercial mortgage-backed securities. it has elected to be taxed as a real estate investment trust and would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. the company was founded in 2014 and is headquartered in new york, new york.
Analysis Results
Intrinsic Value $255.19
Latest Price $12.33
Relative Value 95% undervalued
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Cash Flow (Millions)
Analysis Parameters
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Analysis Details
Growth Rate Projection

An exponential growth model was fit to the past cash flow data, giving more weight to more recent years. This model determined a growth rate estimate of 19.3%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 2.2%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 19.3%, the cash flows for the next 5 years are projected.

The present value of each year's flow is adjusted to present value using the discount rate.

Year Future flow (million) Present value (million)
2023 293 287
2024 350 335
2025 418 391
2026 498 456
2027 594 533
Terminal Value

Assuming the company was sold after the projection period at an exit multiple of 30, the terminal value of the company would be 17800 million. This corresponds to a present value of 15600 million.

Intrinsic Value Per Share

The total present value of the projected cash flows is 2000 million. Adding in the terminal value gives a total present value of 17600 million.

There are presently 69.1 million outstanding shares, so the intrinsic value per share is 255.19.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 7,665,960,000
Current Cash 0
Current Liabilities 6,230,885,000
Current Debt 0
Non-Cash Working Capital (NCWC) 1,435,075,000
Change in NCWC 195,516,000
EBIT 37,651,000
Tax Provision 58,000
Depreciation and Amortization 0
Capital Expenditure 0
Unlevered Free Cash Flow 233,109,000
Current Assets 6,581,217,000
Current Cash 0
Current Liabilities 5,341,658,000
Current Debt 0
Non-Cash Working Capital (NCWC) 1,239,559,000
Change in NCWC 248,788,000
EBIT 137,867,000
Tax Provision 684,000
Depreciation and Amortization 0
Capital Expenditure 0
Unlevered Free Cash Flow 385,971,000
Current Assets 4,910,977,000
Current Cash 0
Current Liabilities 3,920,206,000
Current Debt 0
Non-Cash Working Capital (NCWC) 990,771,000
Change in NCWC -90,889,000
EBIT 54,809,000
Tax Provision 412,000
Depreciation and Amortization 0
Capital Expenditure 0
Unlevered Free Cash Flow -36,492,000
Current Assets 5,014,966,000
Current Cash 0
Current Liabilities 3,933,306,000
Current Debt 0
Non-Cash Working Capital (NCWC) 1,081,660,000
Change in NCWC -19,198,000
EBIT 90,544,000
Tax Provision 579,000
Depreciation and Amortization 0
Capital Expenditure 0
Unlevered Free Cash Flow 70,767,000
Current Assets 5,197,515,000
Current Cash 0
Current Liabilities 4,096,657,000
Current Debt 0
Non-Cash Working Capital (NCWC) 1,100,858,000
Change in NCWC 59,703,000
EBIT 89,737,000
Tax Provision -70,000
Depreciation and Amortization 0
Capital Expenditure 0
Unlevered Free Cash Flow 149,440,000

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