Easterly Government Properties

Easterly Government Properties Inc earns a 5-star quantitative star rating, illustrating our stance that this share class offers a compelling opportunity for investors. The stock currently trades at a 24% discount to our quantitative fair value estimate of $30.22 per share; however, some caution is warranted due to this estimate's medium uncertainty rating.

The firm's valuation metrics increase our estimated fair value. A company's valuation metrics provide insights into the market's expectations for its future growth and profitability. Reflecting the firm's valuation is its book value yield of 118.8%, which ranks in the top 30% compared with global peers. The market price is low relative to the book (accounting) value of the company's equity, which contributes to our view that shares are cheap.

The company's favorable dividend structure is an additional encouraging factor. Dividends represent a stable form of future cash flows returned to shareholders, reducing the perceived risk of a business. The firm's forward dividend yield of 7.7%, for example, lies in the top 10% compared with global peers. Expected dividend payments over the coming year relative to the current share price are favorable, which further promotes our favorable price/fair value ratio.

With its quantitative economic moat rating of none, this business is unlikely to consistently outearn its cost of capital without structural protection from competition. Additionally, the firm's moderate financial health score suggests it is acceptably positioned against adverse economic circumstances.