* Note: Prices are in Million (M) USD.
Description:
NexPoint Real Estate Finance, Inc. (NREF) is a Dallas-based finance company specializing in providing tailored capital solutions for the commercial real estate sector. Leveraging its extensive expertise in real estate investing and finance, NREF focuses on originating, managing, and servicing a diversified portfolio of debt and equity investments, with the goal of delivering attractive risk-adjusted returns for its investors. The company is proactive in identifying and capitalizing on emerging market opportunities, demonstrating a commitment to transparency and alignment with investor interests, positioning it as an appealing option for institutional investors seeking exposure to the dynamic real estate market.
These criteria used Company's Cash, EBITDA and Debt balance to determines its fair value:
Note: Financial institutions (banks/insurers/brokers/REITs) are evaluated using sector, P/E, growth, ROE and other factors. The 3.5× Net Debt/EBITDA rule is skipped to avoid misleading signals; however, Cash/Debt/EBITDA are still displayed and counted for scoring.
Cash : $22 M
Debt : $4,476 M
EBITDA : $150 M
Net Debt (Debt - Cash): $4,454 M
This criteria used industry in which company operates:
Sector: Real estate
Industry: Reit - mortgage
Based on industry, 3 points assigned.
This criteria used Company's Price To Earning (P/E) Ratio to determines its fair value:
Forward PE Ratio: 7.77
Since Forward PE Ratio is less than 15, 5 points assigned.
This criteria used Company's ability to convert Sales into free cash flow to determine fair value:
Using last 9 overlapping fiscal years (max 20).Average Free Cash Flow: $27 M
Average Revenue: $35 M
Revenue Converted To Free Cash Flow (%): 76.5%
Since Free Cash Flow (FCF) to Revenue percentage is greater than 25, 5 points assigned.
This criteria used company's growth potential to calculate its fair value:
Latest Revenue (2024-12-31): $110 M
Revenue 5 Years Ago (2019-12-31): $18 M
Total Growth over 5 Years: 503.6%
5-Year Revenue CAGR (Historical): 43.3%
Forward 5-Year CAGR (Tapered): 21.6%
Since historical Revenue CAGR is greater than 20, 5 points assigned.
This criteria used Company's ability to buy back its own share:
Latest Share Count (2024-12-31): $17 M
Share Count 5 Years Ago (2020-12-31): $5 M
Company is not buying back its own shares, 0 points assigned.
This criteria used Company's dividend payout ratio to determine its fair value:
Next Year Earnings Per Share (EPS): $1.93
Trailing 12-Month Earnings Per Share (EPS): $1.96
Average Earnings Per Share (EPS): $1.95
Dividend Per Share (DPS): $2
Payout Ratio: 103%
Dividend Yield: 13.80%
⚠️ Caution: Further research is recommended — dividend payout ratio is too high (103%).
Since company Payout Ratio is greater than 50, 1 point assigned.
Since Dividend Yield is greater than 5, 5 points assigned.
This criteria used Company's Return On Equity (ROE%) to determine its fair value:
Using last 9 valid ROE years (max 20).Average ROE: 21,545,549.1%
Since Average ROE is greater than 20, 5 points assigned.
This criteria used Company's current price to its 52 week low price to determines its fair value:
Current Price: $15.11
52-Week Low: $11.37
Threshold Price (15% Above 52-Week Low): $13.08
Since Current price is not within 15% threshold, 0 point assigned.
This criteria used Company's Market Cap to determines its fair value:
Market Capitalization: $329 M
Since Market Cap is less than 10B, 1 point assigned.
% Exposure to Total Portfolio
Based on the market cap, we recommend do not exceed 0.5% exposure of Total Portfolio.
Warren Buffett's Owners' Earnings:
Owners' Earnings (FCF/Share) (TTM ending 2025-09-30): $1.83
Owners' Earnings (FCF/Share, latest positive annual) (2024-12-31): $1.68
Note: Many fast-growing companies reinvest heavily, so Owners' Earnings may appear low.
Consider other factors in your valuation.
Value-Trade has assigned 30 points to above Nexpoint Real Estate Finance Inc (NREF) stock.
Heads up: One or more P/E inputs look exaggerated and may skew the blend.
• RCFC Based PE
50.00 (>2× median)
• ROE Based PE
50.00 (>2× median)
Further research is recommended; please use your own due diligence.In such cases, multiplying earnings by the long-run average P/E typically gives a closer, more reliable fair value.
Rule of thumb: Last 4 Years Avg P/E (6.93)
× EPS ($1.95) = $13.48.
Last 4 Years Avg PE
6.93, Fair Value PE
15, Industry Based PE
15, Growth Based PE
21.63, RCFC Based PE
50, ROE Based PE
50, Risk-Free Anchored PE (25% MoS)
17.86. Based on these 7 values, average assigned is
25.20. Value-Trades has assined P/E value
6.93. An average (Current Year EPS + Next Year EPS) earning per share is
$1.945.
Note: Final fair value is the lesser of the blended PE-based fair value and the simple average PE × EPS fair value.Fair value using multiple P/Es (blended): $49.02 (PE 25.20 × EPS $1.95)
Fair value using simple average PE × EPS: $13.48 (PE 6.93 × EPS $1.95)
Lesser of these two: $13.48
So the Final Fair Value is: $13.48
Understanding the Value-Trades P/E Blend (click to expand)
▾
What goes into the blended P/E?
- 20-Year Avg P/E — Long-run market baseline; conservative anchor.
- Fair Value P/E — Score-based (cash, debt, sector, etc.).
- Industry P/E — Peer group norm.
- Growth-Based P/E — Uses tapered growth rates, floored at 15.
- RCFC-Based P/E — Maps cash conversion efficiency.
- ROE-Based P/E — Higher ROE supports higher multiples.
- Risk-Free Anchored P/E — Macro floor tied to 10y yield w/ MoS.
How it works
- Extreme values are clamped/filtered (IQR method).
- Anchors (20y avg, RCFC/ROE, risk-free) are always kept if valid.
- Final fair value = min(Blended PE × EPS, Avg PE × EPS).
P/E Reference Summary
Using EPS: $1.95
Using Owners' Earnings (Latest FCF/Share): $1.83
Note: Many highly growing companies reinvest heavily back into the business,
so their Owners' Earnings may appear very low. In such cases, other criteria should
be considered to assess the company’s true worth.
| Source |
P/E Ratio |
Implied Fair Value |
| Market (1 Yr Ago) | 7.29 | $14.18 |
| 4 Yrs Avg-PE | 6.93 | $13.48 |
| Value-Trades Assigned | 6.93 | $13.48 |
| Owners' Earnings × 4 Yrs Avg-PE | 6.93 | $12.68 |
Note: Only 4 years of reliable P/E data available. Fair value is calculated using blended models to reduce bias.
Financials mode
3.5× Net Debt/EBITDA penalty is disabled; Cash/Debt/EBITDA are shown and counted.
