NewLake Capital Partners (OTCPK:NLCP) - Share price, News & Analysis

NLCP fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	5/6
Past Performance	2/6
Financial Health	5/6
Dividends	3/6

NLCP Stock Overview

NewLake Capital Partners is a leading provider of real estate capital to state-licensed cannabis operators.

Rewards

Trading at 92% below our estimate of its fair value

Earnings are forecast to grow 62.81% per year

Became profitable this year

Risk Analysis

Dividend of 6.99% is not well covered by earnings

NewLake Capital Partners Competitors

Innovative Industrial Properties

NYSE:IIPR

US$3.6b

Price History & Performance

Summary of all time highs, changes and price drops for NewLake Capital Partners
Historical stock prices
Current Share Price	US$18.89
52 Week High	US$35.50
52 Week Low	US$18.00
Beta	0
1 Month Change	-17.15%
3 Month Change	-22.65%
1 Year Change	n/a
3 Year Change	n/a
5 Year Change	n/a
Change since IPO	-37.03%

Shareholder Returns

	NLCP	US REITs	US Market
7D	-4.4%	-0.4%	-0.5%
1Y	n/a	-2.1%	-12.3%

Return vs Industry: Insufficient data to determine how NLCP performed against the US REITs industry.

Return vs Market: Insufficient data to determine how NLCP performed against the US Market.

Price Volatility

Is NLCP's price volatile compared to industry and market?
NLCP volatility
NLCP Average Weekly Movement	4.9%
REITs Industry Average Movement	4.4%
Market Average Movement	7.8%
10% most volatile stocks in US Market	16.9%
10% least volatile stocks in US Market	2.9%

Stable Share Price: NLCP is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: NLCP's weekly volatility (5%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2019	7	David Weinstein	https://www.newlake.com

NewLake Capital Partners is a leading provider of real estate capital to state-licensed cannabis operators. Founded in 2019, it is a triple-net lease REIT that acquires industrial and retail properties through sale-leaseback transactions, third-party purchases and build-to-suit projects. Its tenants are some of the leading operators in the U.S. state-licensed cannabis industry and it is a trusted partner for their real estate needs.

NewLake Capital Partners Fundamentals Summary

How do NewLake Capital Partners's earnings and revenue compare to its market cap?
NLCP fundamental statistics
Market Cap	US$402.36m
Earnings (TTM)	US$14.79m
Revenue (TTM)	US$33.95m

27.2x

P/E Ratio

11.9x

P/S Ratio

Is NLCP overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
NLCP income statement (TTM)
Revenue	US$33.95m
Cost of Revenue	US$266.00k
Gross Profit	US$33.68m
Other Expenses	US$18.89m
Earnings	US$14.79m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	0.69
Gross Margin	99.22%
Net Profit Margin	43.56%
Debt/Equity Ratio	0.4%

How did NLCP perform over the long term?

See historical performance and comparison

Dividends

7.0%

Current Dividend Yield

48%

Payout Ratio

Valuation

Is NewLake Capital Partners undervalued compared to its fair value and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

>50%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: NLCP ($18.89) is trading below our estimate of fair value ($236.26)

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

Price To Earnings Ratio

PE vs Industry: NLCP is good value based on its PE Ratio (27.2x) compared to the US REITs industry average (33.5x).

PE vs Market: NLCP is poor value based on its PE Ratio (27.2x) compared to the US market (15.1x).

Price to Earnings Growth Ratio

PEG Ratio: NLCP is good value based on its PEG Ratio (0.4x)

Price to Book Ratio

PB vs Industry: NLCP is good value based on its PB Ratio (0.9x) compared to the US REITs industry average (1.7x).

Future Growth

How is NewLake Capital Partners forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

Future Growth Score

5/6

Future Growth Score 5/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

62.8%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: NLCP's forecast earnings growth (62.8% per year) is above the savings rate (1.9%).

Earnings vs Market: NLCP's earnings (62.8% per year) are forecast to grow faster than the US market (12.5% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: NLCP's revenue (45.6% per year) is forecast to grow faster than the US market (7.8% per year).

High Growth Revenue: NLCP's revenue (45.6% per year) is forecast to grow faster than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: Insufficient data to determine if NLCP's Return on Equity is forecast to be high in 3 years time

Past Performance

How has NewLake Capital Partners performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

141.2%

Last years revenue growth

Earnings and Revenue History

Quality Earnings: NLCP has high quality earnings.

Growing Profit Margin: NLCP became profitable in the past.

Past Earnings Growth Analysis

Earnings Trend: Insufficient data to determine if NLCP's year-on-year earnings growth rate was positive over the past 5 years.

Accelerating Growth: NLCP has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: NLCP has become profitable in the last year, making it difficult to compare its past year earnings growth to the REITs industry (69.5%).

Return on Equity

High ROE: NLCP's Return on Equity (3.5%) is considered low.

Financial Health

How is NewLake Capital Partners's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: NLCP's short term assets ($114.8M) exceed its short term liabilities ($9.1M).

Long Term Liabilities: NLCP's short term assets ($114.8M) exceed its long term liabilities ($9.1M).

Debt to Equity History and Analysis

Debt Level: NLCP has more cash than its total debt.

Reducing Debt: Insufficient data to determine if NLCP's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: NLCP's debt is well covered by operating cash flow (1357.9%).

Interest Coverage: NLCP earns more interest than it pays, so coverage of interest payments is not a concern.

Balance Sheet

Dividend

What is NewLake Capital Partners's current dividend yield, its reliability and sustainability?

Dividend Score

3/6

Dividend Score 3/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

6.99%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: NLCP's dividend (6.99%) is higher than the bottom 25% of dividend payers in the US market (1.58%).

High Dividend: NLCP's dividend (6.99%) is in the top 25% of dividend payers in the US market (4.11%)

Stability and Growth of Payments

Stable Dividend: Too early to tell whether NLCP's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if NLCP's dividend payments are increasing as they only just started paying a dividend.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (48.1%), NLCP's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its high cash payout ratio (105.3%), NLCP's dividend payments are not well covered by cash flows.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

1.2yrs

Average management tenure

CEO

David Weinstein (54 yo)

1.75yrs

Tenure

US$2,500,152

Compensation

Mr. David L. Weinstein, J.D., serves as the President and Chief Executive Officer at MPG Office, L.P. He served as a Director of Forestar Group Inc. since February 2015 until August 2016. He serves as an I...

CEO Compensation Analysis

Compensation vs Market: David's total compensation ($USD2.50M) is about average for companies of similar size in the US market ($USD2.60M).

Compensation vs Earnings: David's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: NLCP's management team is not considered experienced ( 1.2 years average tenure), which suggests a new team.

Board Members

Experienced Board: NLCP's board of directors are not considered experienced ( 1.2 years average tenure), which suggests a new board.

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: NLCP only recently listed within the past 12 months.

Data	Last Updated (UTC time)
Company Analysis	2022/05/24 00:00
End of Day Share Price	2022/05/23 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31