MeritValue

GLADSTONE COMMERCIAL CORP

GOODdata completeness 88%17 fiscal years on file

Data notes: no data for concept 'capex'; no data for concept 'incomeTaxExpense'; no data for concept 'pretaxIncome'

The thesis, from the filings

GLADSTONE COMMERCIAL CORP earns about 8% on equity, but has diluted owners by 27% over 5 years — worth asking whether the growth reaches owners. The applicable estimate puts fair value near $2.43 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$137.7M1$149M2$147.6M3$149.4M3$161.3M3
Net income$10.9M4$10.8M5$4.99M6$24M6$19.3M6
Operating cash flow$70.1M7$69.2M8$60.4M9$57M9$88.2M9
Capital expenditure—————
Free cash flow (derived)—————
Total debt$707.5M10$749.2M11$738.9M12$693.4M13$843.5M13
Cash & equivalents$7.96M14$11.7M15$12M16$11M16$10.8M16
Diluted shares36.5M39.0M39.9M41.8M46.5M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$36.91
your share of equity
Profit it earned you last year
$4.14
Free cash flow it threw off
—
Debt you’d be carrying
$181.24

10 shares is a claim on $36.91 of net worth that earned you $4.14 last year, against $181.24 of debt.

iii. Is this a good business?
Moat signal · return on equity
8% avg · 5y
FY21 5%FY22 5%FY23 3%FY24 14%FY25 11%

It earned an average 8% on equity over 5 years. Compare that to what it costs to fund the business.

seeing a moat in the numbers →
Management signal · capital allocation
+27% shares · 5y

Share count is up 27% over 5 years — owners have been diluted. Worth asking what they got for it. Total debt has risen 19% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0
DCF · Growth Exit 10Y
not applicable
only 0 years of FCF (need ≥3) — model not applicable
DCF · Growth Exit 5Y
not applicable
only 0 years of FCF (need ≥3) — model not applicable
Earnings Power Value
$2.43
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$10.9M
  • growthAssumed0.0%
Graham Number
$3.41
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0001234006-24-000003 (Revenues)
  2. 10-K · period ending 2022-12-31 · accession 0001234006-25-000003 (Revenues)
  3. 10-K · period ending 2023-12-31 · accession 0001234006-26-000005 (Revenues)
  4. 10-K · period ending 2021-12-31 · accession 0001234006-24-000003 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0001234006-25-000003 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001234006-26-000005 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0001234006-24-000003 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0001234006-25-000003 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001234006-26-000005 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0001234006-23-000003 (LongTermDebt)
  11. 10-K · period ending 2022-12-31 · accession 0001234006-24-000003 (LongTermDebt)
  12. 10-K · period ending 2023-12-31 · accession 0001234006-25-000003 (LongTermDebt)
  13. 10-K · period ending 2024-12-31 · accession 0001234006-26-000005 (LongTermDebt)
  14. 10-K · period ending 2021-12-31 · accession 0001234006-24-000003 (CashAndCashEquivalentsAtCarryingValue)
  15. 10-K · period ending 2022-12-31 · accession 0001234006-25-000003 (CashAndCashEquivalentsAtCarryingValue)
  16. 10-K · period ending 2023-12-31 · accession 0001234006-26-000005 (CashAndCashEquivalentsAtCarryingValue)