SIR Royalty Income Fund Valuation

Is SRV.UN undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

Below Fair Value
Significantly Below Fair Value
Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of SRV.UN when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: SRV.UN (CA$13) is trading below our estimate of fair value (CA$18.53)

Significantly Below Fair Value: SRV.UN is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for SRV.UN?

Key metric: As SRV.UN is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for SRV.UN. This is calculated by dividing SRV.UN's market cap by their current earnings.
What is SRV.UN's PE Ratio?
PE Ratio	5.2x
Earnings	CA$21.12m
Market Cap	CA$121.72m

SRV.UN key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	10x
Enterprise Value/EBITDA	n/a
PEG Ratio	n/a

Price to Earnings Ratio vs Peers

How does SRV.UN's PE Ratio compare to its peers?

The above table shows the PE ratio for SRV.UN vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	Forward PE	Estimated Growth	Market Cap
Peer Average	22.4x
KEG.UN Keg Royalties Income Fund	37.7x	n/a	CA$255.1m
PZA Pizza Pizza Royalty	14.1x	n/a	CA$439.3m
BPF.UN Boston Pizza Royalties Income Fund	12.1x	4.9%	CA$427.3m
AW A & W Food Services of Canada	25.6x	n/a	CA$883.4m
SRV.UN SIR Royalty Income Fund	5.2x	n/a	CA$121.7m

Price-To-Earnings vs Peers: SRV.UN is good value based on its Price-To-Earnings Ratio (5.2x) compared to the peer average (22.4x).

Price to Earnings Ratio vs Industry

How does SRV.UN's PE Ratio compare vs other companies in the North American Hospitality Industry?

4 Companies	Price / Earnings	Estimated Growth	Market Cap

4 Companies		Estimated Growth	Market Cap

No more companies

Price-To-Earnings vs Industry: SRV.UN is good value based on its Price-To-Earnings Ratio (5.2x) compared to the North American Hospitality industry average (22.3x).

Price to Earnings Ratio vs Fair Ratio

What is SRV.UN's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

SRV.UN PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	5.2x
Fair PE Ratio	n/a

Price-To-Earnings vs Fair Ratio: Insufficient data to calculate SRV.UN's Price-To-Earnings Fair Ratio for valuation analysis.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Insufficient data to show price forecast.