Stock Analysis & Valuation Nuveen New York Quality Municipal Income Fund (NAN)

• Previous Close: $11.35
• Sector Valuation Confidence Level: High

Valuation method	Value, $	Upside, %
Artificial intelligence (AI)	n/a	n/a
Intrinsic value (DCF)	5.69	-50
Graham-Dodd Method	9.74	-14
Graham Formula	4.91	-57

Strategic Investment Analysis

Company Overview

Nuveen New York Quality Municipal Income Fund (NAN) is a closed-end fixed income mutual fund managed by Nuveen Investments, Inc., focusing on high-quality municipal bonds within New York. The fund targets tax-exempt income for investors by investing primarily in municipal bonds rated Baa or higher, employing a fundamental, bottom-up approach to portfolio construction. Benchmarking against the S&P New York Municipal Bond Index and S&P National Municipal Bond Index, NAN provides exposure to stable, income-generating assets in the municipal bond market. With a history dating back to 1999, the fund appeals to income-focused investors seeking tax-advantaged returns in a low-volatility asset class. As part of Nuveen’s broader suite of municipal bond funds, NAN benefits from institutional-grade credit research and portfolio management expertise.

Investment Summary

Nuveen New York Quality Municipal Income Fund (NAN) offers investors exposure to high-quality New York municipal bonds, providing tax-exempt income with relatively low volatility (beta: 0.567). The fund’s focus on investment-grade bonds (Baa or higher) mitigates credit risk, while its $345M market cap ensures liquidity. With a trailing dividend yield of ~3.75% (based on $0.864/share annual payout), NAN is attractive for income-seeking investors, particularly those in high tax brackets. However, risks include interest rate sensitivity, New York-specific economic exposure, and leverage (total debt: $244.8M). The fund’s net income of $14M and positive operating cash flow ($13.7M) suggest stable coverage of distributions, but investors should monitor municipal credit trends and Nuveen’s management execution.

Competitive Analysis

NAN competes in the niche of New York-focused municipal bond CEFs, differentiating itself through Nuveen’s scale and credit research capabilities. Its competitive advantage lies in: (1) Nuveen’s dominant market position in municipal bond management, providing access to proprietary research and deal flow; (2) a strict focus on New York bonds, catering to localized investor demand for tax-exempt income; and (3) a quality bias (Baa+ ratings), reducing default risk compared to high-yield muni funds. However, the fund faces competition from both passive ETFs and broader national muni CEFs that offer diversification beyond New York. Its leverage (~41% of total assets) amplifies returns but introduces interest rate risk in a rising-rate environment. Nuveen’s brand recognition helps distribution, but the fund’s performance remains tightly correlated to New York’s fiscal health—a potential vulnerability if state budgets deteriorate.

Major Competitors

• iShares New York Muni Bond ETF (NYF): NYF is a passive ETF tracking New York municipal bonds, offering lower fees (0.25% expense ratio vs. NAN’s ~1.2%) but without active management or leverage. It lacks NAN’s income enhancement strategies but provides greater liquidity and transparency. Best for cost-conscious investors willing to sacrifice potential alpha.
• Nuveen New York Select Tax-Free Income Portfolio (NXN): Another Nuveen-managed New York muni CEF, NXN has a similar strategy but with a longer track record (since 1992) and larger AUM. It competes directly with NAN for investor allocations, though NXN’s portfolio is slightly more diversified across bond maturities.
• Nuveen AMT-Free Quality Muni Income Fund (NEA): Nuveen’s national muni bond CEF (NEA) offers geographic diversification beyond New York, reducing single-state risk. It appeals to investors seeking broader exposure but lacks NAN’s state-specific tax advantages for NY residents. Higher leverage (~42%) increases yield but also volatility.
• VanEck High Yield Muni ETF (HYD): HYD targets higher-yielding (but lower-rated) municipal bonds nationally. It competes for yield-seeking investors but carries significantly more credit risk than NAN’s investment-grade focus. NY-specific investors may prefer NAN’s tax benefits.