Derwent London DLN.L
United KingdomReal Estate · REIT - OfficeLondon Stock Exchange · GBP
21.02 GBP (+17.7%)
14 analysts
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Derwent London is a British REIT that owns, develops, and manages a portfolio of offices and commercial properties in central London, generating income from rents and capital gains from the development of its assets.
Listed on London Stock Exchange · Symbol DLN.L · LON: DLN · Currency GBP
Key points
from its scores- ✕Little or no dividend2.4
- ✕Little competitive advantage4.0
- ✕Fragile balance sheet4.6
AI analysis
bottom line, main risk, context and newsHold, given the valuation discount but with caution due to high leverage and pressure from interest rates on the office real estate sector.
Derwent London has a fragile financial health (Net Debt/EBITDA of 8.37x) and very low return on equity (ROE 1.35%), although it trades at a significant discount to its book value (P/B 0.57). The high payout (190.60%) and the rising interest rate environment in the UK are the main risks to the dividend and the valuation of its assets.
High leverage (Net Debt/EBITDA of 8.37x) combined with rising interest rates in the UK, which makes refinancing more expensive and pressures the valuation of its office assets in a market with weak demand.
Context and risks
Derwent London is a London office REIT, a market with weak demand due to hybrid work and pressure on rents. The rise in long-term rates in the UK makes its refinancing more expensive, given its high leverage (Net Debt/EBITDA of 8.37x), and compresses the valuation of its real estate assets, a structural risk for the sector.
Is Derwent London stock cheap or expensive?
at the analysis dateOn P/E and Price / book, it trades 16% above the Real Estate median on average.
| Multiple | Company | Sector | Difference |
|---|---|---|---|
| P/E | 41.5 | 21.6 | +92% |
| EV / EBITDA | 20.8 | 18.5 | +13% |
| Price / book | 0.6 | 1.4 | −60% |
| Price / sales | 4.8 | 6.3 | −24% |
Sector: median of the 100 Real Estate companies analysed. In bold, the multiples used for the comparison.
Valuation score: 5.5 out of 10 (median for Real Estate: 4.9).
Average analyst target: 21.02 GBP, +17.7% versus the price.
A premium can be justified if the company is of higher quality or grows faster than its sector: Quality / Moat 4.0 (sector 5.2), Growth 5.3 (sector 5.7).
Classic formulas with standard assumptions (10.0% growth, 8-9% discount rate). Indicative only: they change a lot with the assumptions and are not a recommendation.
Work out its fair value yourself →How much would you have made investing every month? →
Comparing it with its sector does not say whether it is a good buy: this is not investment advice.
Score by category
0 to 10 · hover overtap each one to see what it measuresKey metrics
at the analysis date · compared with the Real Estate medianValuation
- P/E
- 41.5
- Forward P/E
- 17.0
- EV / EBITDA
- 20.8
- Price / book
- 0.6
- Price / sales
- 4.8
- PEG
- 18.85
- Market cap
- 2.0B GBP
- Enterprise value
- 3.4B GBP
Profitability
- ROE
- 1.4%
- ROA
- 1.9%
- ROIC (approx.)
- 4.5%
- Gross margin
- 48.6%
- Operating margin
- 53.1%
- Net margin
- 11.7%
- Free cash flow
- 72.5M GBP
- FCF yield
- 3.7%
- Cash conversion
- 45%
Solvency
- Total debt
- 1.5B GBP
- Net debt
- 1.3B GBP
- Cash
- 110.9M GBP
- EBITDA
- 161.0M GBP
- Net debt / EBITDA
- 8.37
- Debt / equity
- 41.50
- Current ratio
- 1.74
- Quick ratio
- 0.72
Growth
- Revenue growth
- +3.8%
- EPS (TTM)
- 0.43 GBP
- EPS (forward)
- 1.05 GBP
Dividend
- Dividend yield
- 4.6%
- Payout
- 190.6%
Risk and market
- Beta
- 1.19
- Analyst consensus
- Hold (14)
- Target price
- 21.02 GBP
Recent news
All DLN.L news →Compare it with its sector
All 100 in Real Estate →Frequently asked questions about Derwent London
Is Derwent London stock cheap or expensive?
On P/E and Price / book, it trades 16% above the Real Estate median on average. Valuation score: 5.5 out of 10 (median for Real Estate: 4.9). Average analyst target: 21.02 GBP, +17.7% versus the price. This is not investment advice.
What score does Derwent London get on MeridIAn Screener?
It scores 4.5 out of 10, rank 1,870 of 2,130 (better than 11% of the companies analysed). Its strongest category is Momentum (6.0) and its weakest, Dividend (2.4). Analysis of 08/10/2026.
What is Derwent London's P/E ratio?
Its P/E is 41.5: the share price equals 41.5 times earnings per share over the last 12 months. The Real Estate median is 21.6. Based on the earnings analysts expect, the forward P/E is 17.0.
How much is Derwent London worth on the stock market?
Its market capitalisation is 2.0B GBP.
Does Derwent London pay a dividend?
Yes: its dividend yield is 4.59% and it pays out 191% of its earnings.
How has Derwent London stock performed over the last year?
It has risen 5.4% over the last year, excluding dividends. Over the last 52 weeks it has traded between 0.00 and 21.96 GBP. Past performance does not guarantee future results.
What do analysts think of Derwent London?
14 analysts cover it; their average recommendation is “Hold” and their average target is 21.02 GBP (+17.7% versus the price). It is an estimate, not market data.