First Trust High Yield Opportunities 2027 Term Fund (FTHY): fair value, margin of safety and Wheel Score

Is FTHY undervalued?

FTHY has a margin of safety of 59%: the stock closed at 12.76 on 16 Oct 2026 against a GLS average fair value of 31.45. 7 of the 8 valuation models that produced a number sit above the price. Our screens treat a discount this large as a strong starting point for a cash-secured put, not as a verdict - the fair value is a model output, and a wide gap can mean the models are missing something the market knows.

There is a wide gap between EPV (7.67) and Payback Time (68.31). When the models are this far apart the "fair value" is really a range, and the margin of safety above should be read with that range in mind.

The nightly engine files FTHY under Speculative / Distressed - negative earnings or a Piotroski score of 3 or less - which caps its Wheel Score at 45 and keeps it out of the Sunday Scan.

Nine valuation models for FTHY

Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.

Quality and financial health

First Trust High Yield Opportunities 2027 Term Fund scores only 0 of 9 on the Piotroski F-score, which fails the Sunday Scan's "6 or more" rule. A reading this low means several of the basic tests - positive earnings, positive operating cash flow, falling debt, no new share issuance - are not met. A GLS Moat score of 3.1/10 is a weak reading: the ten-year history the score grades (revenue, EPS, book value, margins, cash flow, share count, ROIC) has not been steady, so the Moat part of the Wheel Score contributes little.

Returns on capital are thin or negative - ROIC 3.8%, ROE 4.8%, ROA 3.8% - with debt at 0.27 times equity and a free-cash-flow yield of 15.5%.

The dividend yield is high at 11.76% (payout ratio 218%) - a payout above 100% of earnings, which is not covered by profits. A yield this size is often the market's way of pricing a risk to the payout, so the health score and cash flow matter more than usual.

Institutional ownership scores 6/10, insider activity 10/10 and Congressional trading 5/10 on the GLS smart-money scales.

Wheel Score 36: No options

No options are listed on First Trust High Yield Opportunities 2027 Term Fund in our nightly snapshot. The Wheel Score is therefore capped at 39 (it reads 36) and the stock is left out of every options screen; the fair value and health figures above are still useful for a plain stock position.

Volume runs at 104k shares a day on a market cap of $469M, with a beta of 0.65 - a low beta, so day-to-day moves are smaller than the market's; the Stability part of the Wheel Score gives that 7 of 20.

The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.

Upcoming events

No upcoming earnings date is recorded for FTHY in the nightly calendar.

Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.

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