Motley Fool: Are you interested in commercial real estate financing?

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Walker & Dunlop (NYSE: WD) is a small but impressive finance company that has been around since the 1930s and does all kinds of finance for commercial real estate. One of the largest commercial real estate lenders in the country, it issues commercial mortgages with a specific concentration in multi-family properties (including apartment buildings and military and student housing). It is also the eighth largest commercial mortgage service in the United States, with a service portfolio of $ 107.2 billion at the end of 2020.

Walker & Dunlop has experienced explosive growth since its IPO in 2010. Over the past decade, its shares have climbed over 900%, with average annual growth of over 26%. In its latest annual report, it posted 29% year-over-year growth in trading volume, 33% revenue growth and a 41% increase in diluted earnings per share. The company has doubled its turnover in the past five years and is looking to double it again in the next five years.

Investors can expect continued growth over the long term, as well as dividend income, with the company’s payout having recently returned 1.55%. (The Motley Fool owns stock and recommends Walker & Dunlop.)

Ask the fool

Question: What is a company’s “market capitalization”? – TW, Muskegon, Michigan

A: The term is the abbreviation for market capitalization, which reflects the total value of the company in the stock market. It is calculated by multiplying the total number of shares outstanding by the current share price.

Take, for example, Apple, which was recently trading at around $ 150 a share. To find out the total of its outstanding shares, you can consult its latest financial statement. Or check out websites like Yahoo! Finance, which includes outstanding stocks as part of the company statistics they offer. Multiply the recent number of Apple stocks of $ 16.5 billion by $ 150 and you will arrive at its recent market cap – around $ 2.5 trillion. This number can give you an idea of ​​whether the company is overvalued or undervalued, whether you compare it to past levels or to its peers.

Question: If I had invested $ 1 in the stock market after the crash of 1929, what would I have today? – FE, Abilene, Texas

A: The crash of 1929 unfolded over several months and continued beyond 1929. The Dow Jones Industrial Average, or Dow Jones, peaked in early September 1929 at 381. It first fell in October, falling 12.8% on October 28, then 11.7% on October 29, when it closed at 230. It recovered slightly but continued its long decline, falling to 41 in July 1932. At this point , it was down about 89% from its peak. It took 25 years, from 1929 to 1954, for the Dow Jones to reach its previous high of 381 again.

With the Dow Jones recently around 35,800, it has risen 86,800% from that low of 41, which is enough to turn your $ 1 into $ 869, at an average annual growth rate of around 7.9%. . And that doesn’t even include dividends

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My dumbest investment

My dumbest investment? I sold Shopify for $ 80 due to pricing issues. – MA, online

The madman replies: There are different schools of thought in the investing world, and your actions make perfect sense for one of them – value investors – who are looking to buy companies below their fair value. . Value investors may become uncomfortable owning stocks when they appear to be highly valued, as it suggests that they may soon lose value.

The opposite school of thought is that of growth investors, who focus less on valuing a stock and more on its growth prospects. Growth-oriented investors are often willing to pay higher prices for high performing companies, expecting them to meet – and exceed – these values ​​over time.

So while a value investor might never invest in a fast growing stock like Shopify, a growth investor would, perhaps pointing out that companies like Amazon.com and Apple often seemed overvalued and then hit new highs on several occasions.

Shopify’s stock has grown by over 3,400% over the past five years, enough to turn a $ 10,000 investment into more than $ 350,000. The ecommerce software specialist recently had a total market value of $ 183 billion, with many expecting it to be worth much more than that in the future. Others, however, wonder if the stock has taken a lead.


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