Easterly Government Properties Inc. Common Stock (DEA)

FairStock Score: 32/100 — RISKY

Key Financials

Strengths

• Generates $159 million in annual free cash flow (14.7% yield on market cap)
• Attractive 7.8% dividend yield providing steady income returns

Concerns

• Trades significantly above Graham Number ($13) with negative 77% margin of safety—limited downside protection
• Altman Z-Score of 0.3 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Easterly Government Properties Inc. Common Stock is a micro-cap real estate company valued at $1.1 billion. The business generates $343 million in annual revenue with a 1.3% net margin and $159 million in free cash flow. From a quality standpoint, Easterly shows solid Piotroski F-Score of 6/9 and distressed Altman Z-Score of 0.3 warrants caution. On valuation, the stock is commanding a steep 85.8x multiple, with trades above its Graham Number with a negative 77% margin. Growth dynamics show revenue growing at 11.2% and profit growth of -15.8%. The 7.8% dividend yield adds an income component for patient holders. Our composite FairStock Score of 32/100 reflects below-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. With $159 million in annual free cash flow (14.7% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

At 86x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer