Cohen & Steers Drops 25% as Real Asset Markets Shift — What Does Fair Value Look Like Now?

If you’re standing at the crossroads wondering what to do with Cohen & Steers stock, you’re not alone. Over the past year, the shares have frustrated some investors and tempted others. The stock is down 25.6% in the last 12 months and has dropped 27.7% so far this year. That certainly isn’t what most folks sign up for. But step back, and there’s more to the story. Over five years, Cohen & Steers has still delivered a tidy 32.4% total return, showing that the story isn’t just about recent volatility.

So, what’s driving these moves? Some of the pressure on the stock can be traced back to broader market uncertainty, especially in sectors related to real assets and property, which Cohen & Steers focuses on. Investors seem to be rethinking risk and adjusting their expectations, which often leads to sudden swings in price. Yet, with a recent close at $66.07 and only a slight loss of 0.7% in the last seven days, it’s worth asking whether all the bad news is priced in or if the market knows something we don’t.

Here is where valuation comes in. Based on a range of industry-standard methods, Cohen & Steers scores just a 1 out of 6 for being undervalued, meaning it only passed one major check for a potential bargain. But numbers only tell part of the story. Next, we’ll explore how these classic valuation tools measure up, and later, I’ll share an approach many investors overlook, which could really change how you see this company.

Cohen & Steers scores just 1/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Cohen & Steers Excess Returns Analysis

The Excess Returns model evaluates whether a company consistently earns more than its cost of capital, focusing closely on how well shareholders’ money is put to work. For Cohen & Steers, this approach tells us how efficiently the company turns its equity into profit, beyond what’s required just to compensate investors for risk.

Looking at the numbers, Cohen & Steers boasts an average Return on Equity of 31.45%, suggesting the company is quite effective at generating gains for shareholders. Its Book Value stands at $10.36 per share, with a Stable EPS of $2.41 per share, calculated from the company’s median performance over the past five years. The Cost of Equity is $0.63 per share, meaning Cohen & Steers is generating an Excess Return of $1.78 per share beyond what investors would expect for the risk they take. The Stable Book Value is $7.65 per share, again based on five-year medians.

Despite these impressive metrics, the model pegs the stock as 55.7% overvalued relative to its estimated intrinsic worth. With the current share price well above what the Excess Returns approach justifies, investors relying on this method may see limited upside here.

Result: OVERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Cohen & Steers.

Our Excess Returns analysis suggests Cohen & Steers may be overvalued by 55.7%. Find undervalued stocks or create your own screener to find better value opportunities.

Approach 2: Cohen & Steers Price vs Earnings

The Price-to-Earnings (PE) ratio is a widely recognized metric for evaluating profitable companies. It tells investors how much they are paying for each dollar of earnings, making it particularly relevant for firms like Cohen & Steers, which have demonstrated consistent profitability. The usefulness of the PE ratio comes from its ability to reflect market expectations for growth, risk, and earnings stability. A higher PE often signals anticipation of faster growth or lower risk, while a lower PE can indicate the opposite.

At a current PE ratio of 20.8x, Cohen & Steers sits below the broader Capital Markets industry average of 27.0x, but is priced well above its peers, which average 11.9x. This suggests investors are willing to pay a premium relative to peers, but the stock appears less expensive than some of the sector’s larger, faster-growing names.

The “Fair Ratio” for Cohen & Steers, as calculated by Simply Wall St, is 16.6x. Unlike simple peer or industry comparisons, which can be overly blunt, the Fair Ratio incorporates the company’s unique features, such as its profit margins, expected earnings growth, market cap, and specific risks. As a result, it is a more tailored gauge for what investors should reasonably pay for the stock under current conditions.

Comparing Cohen & Steers’ actual PE (20.8x) with its Fair Ratio (16.6x) indicates the stock is a bit on the expensive side based on these fundamentals.

Result: OVERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Cohen & Steers Narrative

Earlier we mentioned there is an even better way to understand valuation, so let's introduce you to Narratives. A Narrative is simply your story about where you think Cohen & Steers is headed, linking real company insights to a specific financial forecast and your own fair value estimate. Instead of just looking at charts and ratios, you can combine your expectations, such as future revenue growth, profit margins and target price, into a clear, personalized valuation grounded in your research and perspective.

Narratives are easy to create and explore on the Simply Wall St Community page, where millions of investors share their views. You can see exactly how different stories stack up. What sets Narratives apart is how they help you make investment decisions: by comparing your Fair Value (based on your assumptions) to the current share price, you get a straightforward signal on when to buy or sell. Plus, Narratives update automatically whenever new information, such as earnings announcements or news, comes in, making sure your view stays relevant.

For example, some investors see Cohen & Steers’ global expansion and active ETF platform driving the stock toward a fair value of $80.00, while more cautious investors, concerned about passive trends or regional risks, set their estimate closer to $66.00.

Do you think there's more to the story for Cohen & Steers? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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