Western Asset Municipal High Income Fund (MHF): fair value, margin of safety and Wheel Score

Is MHF undervalued?

At 6.36 (close of 16 Oct 2026), MHF trades 20% under the GLS average fair value of 7.96. 3 of the 7 models that produced a value land above the price. A discount of this size counts as a positive margin of safety in every GLS screen; whether it is enough depends on the rest of the picture - the health score, the moat and the option premium below.

There is a wide gap between DCF (1.84) and Graham Growth (21.07). 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 MHF under High Yield Income: a dividend yield above 4%.

Nine valuation models for MHF

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

Western Asset Municipal High Income Fund scores only 4 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 1.3/10 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 2.3%, ROE 2.4%, ROA 2.3% - with debt at 0.02 times equity and negative free cash flow.

The dividend yield is high at 6.42% (payout ratio 0%). 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 3/10, insider activity 5/10 and Congressional trading 5/10 on the GLS smart-money scales.

Wheel Score 38: No options

No options are listed on Western Asset Municipal High Income Fund in our nightly snapshot. The Wheel Score is therefore capped at 39 (it reads 38) 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 56k shares a day on a market cap of $141M, with a beta of 0.49 - a low beta, so day-to-day moves are smaller than the market's; the Stability part of the Wheel Score gives that 6 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 MHF in the nightly calendar. The shares go ex-dividend on 23 Oct 2026 (0.0340 per share), so a covered call sold before then carries a small early-assignment risk around that date.

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

Similar stocks in Asset Management

The 12 companies below are the closest to Western Asset Municipal High Income Fund by market cap within the Asset Management industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.

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