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KIM (Kimco Realty) Earnings Power Value (EPV) : $-2.86 (As of Sep24)


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What is Kimco Realty Earnings Power Value (EPV)?

As of Sep24, Kimco Realty's earnings power value is $-2.86. *

* GuruFocus does not store EPV value into our database if Average Maintenance CAPEX is 0.

Margin of Safety is N/A.

The basic concept of EPV is that one should value a stock based on the current free cash flow of a company and not on future projections which may, or may not, come true. It is arguably a better way to analyze stocks than Discounted Cash Flow analysis that relies on highly speculative growth assumptions many years into the future. Assumption: Current profitability is sustainable.


Kimco Realty Earnings Power Value (EPV) Historical Data

The historical data trend for Kimco Realty's Earnings Power Value (EPV) can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Kimco Realty Earnings Power Value (EPV) Chart

Kimco Realty Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
Earnings Power Value (EPV)
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Kimco Realty Quarterly Data
Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 Jun24 Sep24
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Competitive Comparison of Kimco Realty's Earnings Power Value (EPV)

For the REIT - Retail subindustry, Kimco Realty's Earnings Power Value (EPV), along with its competitors' market caps and Earnings Power Value (EPV) data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Kimco Realty's Earnings Power Value (EPV) Distribution in the REITs Industry

For the REITs industry and Real Estate sector, Kimco Realty's Earnings Power Value (EPV) distribution charts can be found below:

* The bar in red indicates where Kimco Realty's Earnings Power Value (EPV) falls into.



Kimco Realty Earnings Power Value (EPV) Calculation

Earnings Power Value also known as just Earnings Power is a valuation technique popularised by Bruce Greenwald, an authority on value investing at Columbia University. It is arguably a better way to analyze stocks than Discounted Cash Flow analysis that relies on highly speculative growth assumptions many years into the future.

The basic concept of EPV is that one should value a stock based on the current free cash flow of a company and not on future projections which may, or may not, come true. This valuation tool excludes the potential growth that a company may have so that needs to be looked at separately. Since future growth is excluded from the analysis, only the maintenance capital expenditures are subtracted from after-tax EBIT (earnings before interest and taxes) and growth capex is ignored.

Kimco Realty's "Earning Power" Calculation:

Average of Last 20 Quarters Last Quarter
Revenue 1,548
DDA 438
Operating Margin % 32.76
SGA * 25% 29
Tax Rate % 7.06
Maintenance Capex 0
Cash and Cash Equivalents 791
Short-Term Debt 0
Long-Term Debt 8,424
Shares Outstanding (Diluted) 672

1. Start with "Earnings" not including accounting adjustments (one-time charges not excluded unless policy has changed). "Earnings" are "Operating Income.

2. Look at average margins over a business/Industry cycle: Average Operating Margin = 32.76%

To normalize margins and eliminate the effects on profitability of valuing the firm at different points in the business cycle, it is usually best to take a long-term average of operating margins. Ideally this would be as long as 10 years and include at least one economic downturn. However, since most of companies do not have as long as 10-year history, here GuruFocus uses the latest 5 years data to do the calculation. To smooth out unusual years but reflect recent developments, we take an average of the 5 year margin.

3. Multiply average margins by sustainable revenues and then adjust for maintenance SGA. This yields "normalized" EBIT:

To be conservative, GuruFocus uses an average of the 5 year revenues as the sustainable revenue.
EPV analysis recognises that part of SG&A expenditure is made to maintain and replace the existing assets, while part is made to grow sales. Since EPV is only interested in what it costs a going concern to maintain its existing asset base, it adds back a percentage of SG&A (between 15% and 50% - this is a matter of judgment and industry knowledge) to make up for the fact that some of this expenditure went to fund growth and shouldn't be accounted for. To start off, we assume 25% for the sake of prudence.
Sustainable Revenue = $1,548 Mil, Average Operating Margin = 32.76%, Average Adjusted SGA = 29,
therefore "Normalized" EBIT = Sustainable Revenue * Average Operating Margin + Average Adjusted SGA = 1,548 * 32.76% +29 = $536.358437461 Mil.

4. Multiply by one minus Average Tax Rate (NOPAT):

Same as average operating margin calculation, GuruFocus takes an average of the 5 years tax rates.
Average Tax Rate = 7.06%, and "Normalized" EBIT = $536.358437461 Mil,
therefore After-tax "Normalized" EBIT = "Normalized" EBIT * ( 1 - Average Tax Rate ) = 536.358437461 * ( 1 - 7.06% ) = $498.50762252938 Mil.

5. Add back Excess Depreciation (after tax at 1/2 average tax rate). This yields "normalized" Earnings:

Excess Depreciation = Average DDA * % of Excess Depreciation (after tax at 1/2 average tax rate) = 438 * 0.5 * 7.06% = $15.454964083 Mil.
"Normalized" Earnings = After-tax "Normalized" EBIT + Excess Depreciation = 498.50762252938 + 15.454964083 = $513.96258661238 Mil.

6. Adjusted for Maintenance Capital Expenditure:

First, calculate the revenue change regarding to the previous year. If the revenue decreased from the previous year, then the Maintenance Capital Expenditure = Capital Expenditure (positive).
Second, if the revenue increased from the previous year, then calculate the percentage of Net PPE as of corresponding Revenue.
Third, calculate Capital Expenditure (positive) - percentage of Net PPE as of corresponding Revenue * revenue increase.
If [Capital Expenditure (positive) - percentage of Net PPE as of corresponding Revenue * revenue increase] was negative, then the Maintenance Capital Expenditure = Capital Expenditure (positive).
If [Capital Expenditure (positive) - percentage of Net PPE as of corresponding Revenue * revenue increase] was positive, then the Maintenance Capital Expenditure = Capital Expenditure (positive) - percentage of Net PPE as of corresponding Revenue * revenue increase.
Fourth, GuruFocus uses an average of the 5 year maintenance capital expenditures as maintenance CAPEX.
Kimco Realty's Average Maintenance CAPEX = $0 Mil *.
* GuruFocus does not store EPV value into our database if Average Maintenance CAPEX is 0.

7. Investors require a return of "WACC" for the risk they are taking: WACC = 9%

8. Kimco Realty's current cash and cash equivalent = $791 Mil.
Kimco Realty's current interest bearing debt = Long-Term Debt & Capital Lease Obligation + Short-Term Debt & Capital Lease Obligation = 8,424 + 0 = $8423.632 Mil.
Kimco Realty's current Shares Outstanding (Diluted Average) = 672 Mil.

Kimco Realty's Earnings Power Value (EPV) for Sep24 is calculated as:

EPV = ( ( Norm. Earnings-Maint. CAPEX *) / WACC + CashandEquiv - Int. Bearing Debt ) / Shares Outstanding (Diluted Average)
= ( ( 513.96258661238 - 0)/ 9%+791-8423.632 )/672
=-2.86

Margin of Safety (EPV)=( Earnings Power Value (EPV)-Current Price )/Earnings Power Value (EPV)
=( -2.8613704656291-24.61 )/-2.8613704656291
= N/A

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* GuruFocus does not store EPV value into our database if Average Maintenance CAPEX is 0.


Kimco Realty  (NYSE:KIM) Earnings Power Value (EPV) Explanation

Assumption: Current profitability is sustainable.

Earnings power value (EPV) uses a very basic equation which assumes no growth, although it does rely on an assumption about the cost of capital as well as the fact that current earnings are sustainable. It also involves several adjustments to clean up the underlying Earnings figures.


Be Aware

Though using today's earnings in calculating Earnings Power Value, GuruFocus is normalizing these earnings to the business cycle. This eliminates the effects on profitability of valuing the firm at different points in the business cycle. This means that we are considering the average earnings over 5 years.


Kimco Realty Earnings Power Value (EPV) Related Terms

Thank you for viewing the detailed overview of Kimco Realty's Earnings Power Value (EPV) provided by GuruFocus.com. Please click on the following links to see related term pages.


Kimco Realty Business Description

Industry
Address
500 North Broadway, Suite 201, Jericho, NY, USA, 11753
One of the oldest real estate investment trusts in the United States, Kimco Realty owns interests in 567 shopping centers throughout major markets in the US, representing roughly 101 million square feet.
Executives
David Jamieson officer: Chief Operating Officer C/O KIMCO REALTY CORP., 3333 NEW HYDE PARK ROAD, NEW HYDE PARK NY 11042
Frank Lourenso director 3333 NEW HYDE PARK ROAD, NEW HYDE PARK NY 11042
Glenn Gary Cohen officer: V.P. - Treasurer 3333 NEW HYDE PARK ROAD, NEW HYDE PARK NY 11042
Paul Westbrook officer: VP - Chief Accounting Officer C/O KIMCO REALTY CORP., 3333 NEW HYDE PARK ROAD, NEW HYDE PARK NY 11042
Richard B Saltzman director C/O COLONY NORTHSTAR, INC., 515 S. FLOWER ST., 44TH FLOOR, LOS ANGELES CA 90071
Henry Moniz director C/O KIMCO REALTY CORPORATION, 500 NORTH BROADWAY, SUITE 201, JERICHO NY 11753
Coviello Philip E Jr director GETTY REALTY CORP, 2 JERICHO PLAZA, STE 110, JERICHO NY 11753
Joe Grills director MERRILL LYNCH ASSET MANAGEMENT, 800 SCUDDER MILL ROAD, PLAINSBORO NJ 08536
Valerie Richardson director C/O KIMCO REALTY CORP., 333 NEW HYDE PARK ROAD, NEW HYDE PARK NY 11042
Milton Cooper director, officer: Chairman & CEO C/O KIMCO REALTY CORP, 3333 NEW HYDE PARK RD STE 100, HYDE PARK NY 11042
Ross Cooper officer: President C/O KIMCO REALTY CORP., 3333 NEW HYDE PARK ROAD, NEW HYDE PARK NY 11042
Mary Hogan Preusse director C/O KIMCO REALTY CORP., 3333 NEW HYDE PARK ROAD, NEW HYDE PARK NY 11042
Flynn Conor C officer: President, COO and CIO C/O KIMCO REATLY CORP., 3333 NEW HYDE PARK ROAD, NEW HYDE PARK NY 11042
David Henry officer: Cheif Executive Officer 3333 NEW HYDE PARK ROAD, NEW HYDE PARK NY 11042
Michael V Pappagallo officer: V.P. - CFO BRIXMOR PROPERTY GROUP, 450 LEXINGTON AVENUE, NEW YORK NY 10017