Undervalued dividend stocks after multiple compression
S&P Global core franchise is mispriced after Mobility spin-off
Roughly 96% recurring revenue, ~35.6% free cash flow margin, and ~16% annual FCF-per-share growth over five years underpin quality, yet the stock is down ~16% year-to-date on multiple compression alone (P/E ~23x, ~21% below history). Ratings, indices, and data earn 50%+ margins while Mobility dragged blended perception; post-separation as MBGL, segment-level comps to Moody’s and MSCI imply material upside if the market re-rates the remaining entity toward peer multiples.
| Instrument | Side | Target | Reason |
|---|---|---|---|
| SPGI | Long | 563 | High-margin, recurring data and ratings businesses trade at a discount to intrinsic sum-of-the-parts and to Moody’s/MSCI-like peers; Mobility separation clarifies the quality of what remains and should unlock a higher blended multiple on fundamentals that already compound free cash flow strongly. |
VICI Properties offers yield and AFFO growth at a cycle-low multiple
Triple-net gaming real estate with escalators, ~40-year master leases, and 100% rent collection through the pandemic supports predictable cash flows; AFFO per share rose from $1.82 (2021) to $2.38 (2025) with ~74% AFFO payout. Trading near ~10.98x AFFO (~22% below five-year average) and ~6.6% yield, sentiment over tenant weakness has overshot operating reality including 4.5% AFFO growth and raised 2026 guidance.
| Instrument | Side | Target | Reason |
|---|---|---|---|
| VICI | Long | 33 | Contractual rent growth and fortress lease structure limit downside while AFFO compounds; the market prices permanent tenant distress despite full collections and investment-grade balance sheet discipline, leaving room for multiple mean reversion plus a well-covered 6%+ starting yield. |
Verizon combines high yield with accelerating earnings after 5G capex peak
~6.5% dividend yield with ~57% FCF payout leaves coverage room uncommon for high-yield telecom. Capex intensity is easing post-5G build, monetization via pricing, fixed wireless, and fiber should lift cash conversion; Frontier integration adds footprint and synergies over time. Consensus EPS paths toward ~5% growth in 2026 rising above 11% by 2029 make modest dividend growth sufficient for double-digit total return potential from today’s valuation.
| Instrument | Side | Target | Reason |
|---|---|---|---|
| VZ | Long | The market still prices Verizon as a no-growth bond proxy, but falling capex intensity and fiber scale should convert more revenue into free cash flow and EPS, supporting ~2.75%+ dividend growth and mid-teens upside alongside a 6.5% income stream without stressing payout ratios. |
Themes
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