Nuveen California AMT-Free Quality Municipal Income Fund (NKX) Fundamental Analysis: Bull vs. Bear Case

NKX

Nuveen California AMT-Free Quality Municipal Income Fund

Fundamental data last updated:August 12, 2026

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company profile

SECTOR

Financial Services

industry

Asset Management - Income

Exchange

NYSE

County of HQ

US

Next Earnings Date

Not Scheduled

Business Summary

Nuveen California AMT-Free Quality Municipal Income Fund is a closed ended fixed income mutual fund launched by Nuveen Investments, Inc. The fund is co-managed by Nuveen Asset Management, LLC and Nuveen Fund Advisors LLC. It invests in the fixed income markets of California, United States. The fund primarily invests in undervalued municipal securities and other related investments the income which are exempt from regular federal and California income taxes and are rated Baa, BBB or higher with an average maturity of 20.17 years. It employs fundamental analysis with a bottom-up approach to create its portfolio. The fund benchmarks the performance of its portfolio against the Standard & Poor's (S&P) California Municipal Bond Index and the S&P National Municipal Bond Index. It was formerly known as Nuveen California AMT-Free Municipal Income Fund. Nuveen California AMT-Free Quality Municipal Income Fund was formed on November 21, 2002 and is domiciled in the United States.

VALUATION

P/E

-16.76

Market Cap ($M USD)

$674.46M

Forward P/E

N/A

PEG

N/A

PRICE TO SALES

15.75 PRICE TO BOOK

1.09 EV / EBITDA

-51.95

5-Year Average P/E

Free Cash Flow Yield

4.79%

DCF Value

$-12.95

Graham Number

N/A

Price to FCF

20.87 EV to FCF

34.38 Earnings Yield

-5.97%

FCF Yield

4.79%

DIVIDEND

Yield

7.23%

Annual Payout

$0.91

Payout Ratio

-140.41%

Consecutive Years of Dividend Growth

5-Year Dividend Growth Rate

Financial Health & Profitability

Earnings Per Share

-$0.75

Next Year EPS Growth Estimate

N/A

Next Year Revenue Growth Estimate

N/A

Return on Equity (ROE)

-6.23%

FREE CASH FLOW

Operating Margin

-49.95%

Debt-to-Equity

0.76 Piotroski F-Score

5 Altman Z-Score

0.87 Return on Invested Capital (ROIC)

-2.11%

Current Ratio

1.66 Quick Ratio

1.66 Net Debt to EBITDA

-20.41

Interest Coverage

-2.79

Gross Profit margin

40.60%

FCF PER SHARE

$0.65

REVENUE PER SHARE

$0.86

Gainseekers Quantitative Analysis

Summary

NKX’s valuation paints a grim picture. The stock has traded below its DCF value, suggesting the market may have overestimated its worth. With a negative Price/Earnings ratio and an Altman Z-score below 1, the financial health appears precarious, hinting at potential distress. The negative earnings yield further underscores the lack of profitability, while the absence of a Forward P/E ratio leaves future earnings growth in question. Overall, the market seems to have priced in significant risk, reflecting skepticism about the company’s ability to turn around its fortunes.

AI Exposure / Tech Reliance

In the realm of AI and tech adaptation, NKX's position in the asset management industry suggests limited direct exposure to technological shifts. However, the sector's reliance on data analytics for investment strategies could offer some resilience. The company's ability to leverage tech for operational efficiency remains a critical factor for future competitiveness.

The Bull Case

For the value-seeking investor, NKX offers a compelling yield of 7.32%, which could be attractive in a low-interest-rate environment. The Piotroski F-Score of 5 indicates moderate financial health, while a decent Free Cash Flow yield suggests some level of capital efficiency. Despite negative margins, the company's ability to generate cash flow could hint at underlying pricing power, making it a potential turnaround play for those with a high-risk tolerance.

The Bear Case

The bear case for NKX is hard to ignore. With a Price/Sales ratio over 15 and a Price/Book ratio slightly above 1, the stock appears overvalued relative to its fundamentals. The negative operating margin and return on equity highlight severe profitability issues. Additionally, the stock's proximity to its 52-week high suggests it might be technically overextended, raising concerns about future downside risk.

Market Sentiment & Smart Money

Short Interest %

Analyst Consensus

N/A

Average Analyst Price Target

N/A

Institutional Ownership %

1-Year Beta

0.62 Insider Buying % (6 Mo)

Distance to 52-Week High

4.60%

Distance to 52-Week Low

9.35%

EARNINGS SURPRISE %

N/A

50-DAY SMA

$12.29

200-DAY SMA

$12.53

⚠️ Financial Disclaimer:
This content is for informational purposes only and is not financial advice. Information may be delayed or inaccurate. We may earn a commission from partner links.