Lead Real Estate Co. Ltd American Depositary Shares (LRE)

FairStock Score: 64/100 — STEADY

Key Financials

Strengths

• Solid return on equity of 18.3% above cost of capital
• Attractive 5.0% dividend yield providing steady income returns

Concerns

• High leverage at 2.59x debt-to-equity increases financial risk and interest expense burden
• Weak Piotroski F-Score of 0/9 suggests deteriorating financial quality across multiple dimensions
• Altman Z-Score of 0.3 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Lead Real Estate Co. Ltd American Depositary Shares is a micro-cap real estate company valued at $18 million. Revenue stands at $18.8 billion. From a quality standpoint, Lead shows weak Piotroski F-Score of 0/9 signaling deteriorating fundamentals and distressed Altman Z-Score of 0.3 warrants caution. On valuation, the stock is deeply undervalued on a P/E basis at 3.3x, with offers a 97% margin of safety vs Graham Number of $48. The 5.0% dividend yield adds an income component for patient holders. Our composite FairStock Score of 64/100 reflects above-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

The market underappreciates Lead's consistent 18% ROE at just 3x earnings—a re-rating toward sector peers could unlock 30-50% upside. Operational leverage in the business model means incremental revenue growth could disproportionately boost bottom-line profitability.

Bear Case

Elevated leverage at 2.6x D/E means rising interest rates or revenue weakness could strain debt covenants and force asset sales at distressed prices. 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