Education
About Us
Working with TipRanks
Follow Us
Alexandria Real Estate Equities (ARE)
NYSE:ARE
Top Page
Alexandria Equities
(NYSE:ARE)78Outperform
Positive Factors
Leasing Activity
ARE executed on 1.3m sq.ft. of leasing activity during the quarter, which is above historical averages, a positive given high supply in the market.
Stock Valuation
ARE is trading at an approximately 30% discount to NAV, offering a potential total return of around 39% including capital appreciation and yield.
Negative Factors
Market Conditions
Supply headwinds are a concern, affecting the near-term market conditions for the company.
Alexandria Equities (ARE) vs. S&P 500 (SPY)
Market Cap
$17.39B
Dividend Yield5.16%
Average Volume (3M)1.35M
Price to Earnings (P/E)55.9
Beta (1Y)1.33
Revenue Growth7.99%
EPS Growth232.16%
CountryUS
Employees552
SectorReal Estate
Sector Strength72
IndustryREITs
Share Statistics
EPS (TTM)1.80
Shares Outstanding173,091,770
10 Day Avg. Volume1,245,637
30 Day Avg. Volume1,347,277
Financial Highlights & Ratios
PEG Ratio0.24
Price to Book (P/B)N/A
Price to Sales (P/S)5.64
Price to Cash Flow (P/CF)16.00
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$119.14Price Target Upside16.59% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering8
Alexandria Equities Business Overview & Revenue Model
Company DescriptionAlexandria Real Estate Equities, Inc. (ARE) is a real estate investment trust (REIT) focused on owning, operating, and developing high-quality, sustainable real estate properties in urban innovation clusters. The company's core business involves providing office and laboratory space for clients in the life sciences, technology, and agtech industries. Alexandria's properties are strategically located in key innovation hubs such as Greater Boston, San Francisco, New York City, San Diego, Seattle, Maryland, and Research Triangle.
How the Company Makes MoneyAlexandria Real Estate Equities, Inc. generates revenue primarily through leasing its properties to tenants in the life sciences, technology, and agtech sectors. The company's revenue model is based on long-term lease agreements, which provide a stable and predictable cash flow. Additionally, Alexandria benefits from property development and redevelopment projects, which add value to its real estate portfolio. The company may also engage in strategic partnerships and joint ventures to enhance its development capabilities and expand its market reach. By maintaining a focus on urban innovation clusters, Alexandria is able to attract high-quality tenants and maintain high occupancy rates, which are critical factors in its earnings.
Alexandria Equities Financial Statement Overview
Summary
Alexandria Equities demonstrates strong financial performance with robust revenue growth, efficient operations, and a solid balance sheet. Positive cash flow and zero debt in the most recent year further indicate financial stability, although historical leverage fluctuations require attention.Income Statement
Alexandria Equities has shown robust revenue growth over the years, with a notable increase from 2019 to 2024. The Gross Profit Margin and Net Profit Margin have been strong, reflecting efficient operations and good cost management. The EBIT and EBITDA margins are healthy, indicating strong operational performance. Overall, the income statement reflects a well-managed growth trajectory with stable profitability.88
Very Positive
Balance Sheet
The company's balance sheet is strong, with significant stockholders' equity and a zero debt level in the most recent year, indicating excellent financial health and stability. The Equity Ratio is solid, showing a healthy proportion of equity financing. However, fluctuations in the debt levels over previous years suggest attention to leverage management is necessary.79
Positive
Cash Flow
Alexandria Equities has demonstrated positive free cash flow, with good growth over the years. The Operating Cash Flow to Net Income Ratio is favorable, indicating efficient cash flow generation relative to earnings. While there have been fluctuations in free cash flow, the company maintains a strong cash position, highlighting its ability to manage cash effectively.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 3.12B | 2.89B | 2.59B | 2.11B | 1.89B | Gross Profit |
| 2.21B | 2.03B | 1.81B | 1.49B | 1.36B | EBIT |
| 2.04B | 1.09B | 627.03M | 530.33M | 532.12M | EBITDA |
| 1.90B | 1.45B | 1.63B | 1.35B | 1.23B | Net Income Common Stockholders |
| 322.95M | 103.64M | 521.66M | 416.83M | 591.20M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 552.15M | 618.19M | 825.19M | 361.35M | 568.53M | Total Assets |
| 37.53B | 36.77B | 35.52B | 30.22B | 22.83B | Total Debt |
| 12.75B | 11.70B | 10.16B | 8.79B | 7.56B | Net Debt |
| 12.20B | 11.08B | 9.33B | 8.43B | 6.99B | Total Liabilities |
| 15.13B | 14.15B | 12.84B | 11.19B | 9.38B | Stockholders Equity |
| 22.38B | 18.47B | 18.97B | 16.19B | 11.73B |
| Cash Flow | Free Cash Flow | |||
| 1.50B | 1.63B | 1.29B | -6.32B | -2.39B | Operating Cash Flow |
| 1.50B | 1.63B | 1.29B | 1.01B | 882.51M | Investing Cash Flow |
| -1.51B | -2.50B | -5.08B | -7.11B | -3.28B | Financing Cash Flow |
| -93.31M | 674.16M | 4.23B | 5.92B | 2.75B |
Alexandria Equities Technical Analysis
Positive
102.19
Price Trends
97.89
Positive
103.57
Negative
109.43
Negative
Market Momentum
0.98
Negative
61.13
Neutral
75.84
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARE, the sentiment is Positive. The current price of 102.19 is above the 20-day moving average (MA) of 97.64, above the 50-day MA of 97.89, and below the 200-day MA of 109.43, indicating a neutral trend. The MACD of 0.98 indicates Negative momentum. The RSI at 61.13 is Neutral, neither overbought nor oversold. The STOCH value of 75.84 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ARE.
Alexandria Equities Risk Analysis
Alexandria Equities disclosed 89 risk factors in its most recent earnings report. Alexandria Equities reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Alexandria Equities Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $17.39B | 55.86 | 1.70% | 5.16% | 7.99% | 232.16% | |
64 Neutral | $15.01B | 933.97 | 1.27% | 1.88% | -1.30% | -80.81% | |
63 Neutral | $4.06B | 19.23 | 3.87% | 6.35% | 0.53% | -1.38% | |
61 Neutral | $4.91B | 18.99 | -3.12% | 7.77% | 6.71% | -19.69% | |
60 Neutral | $11.66B | 741.81 | 0.18% | 5.76% | 4.10% | -92.47% | |
54 Neutral | $4.65B | 782.95 | 0.78% | 4.89% | 5.12% | ― | |
52 Neutral | $449.96M | ― | -12.75% | 3.23% | -11.47% | -89.12% |
* Real Estate Sector Average
Performance Comparison
ARE
Alexandria Equities
102.19
-16.39
-13.82%
BXP
Boston Properties
67.68
8.08
13.56%
HPP
Hudson Pacific Properties
3.20
-3.36
-51.22%
KRC
Kilroy Realty
34.00
-0.25
-0.73%
SLG
SL Green Realty
61.83
13.62
28.25%
VNO
Vornado Realty
40.30
14.72
57.54%
Alexandria Equities Earnings Call Summary
Earnings Call Date: Oct 21, 2024 | % Change Since: -13.33% | Next Earnings Date: Apr 28, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted Alexandria's strong financial and operational performance, with significant revenue and leasing growth. However, it also acknowledged the challenging economic environment and pressures from competitive supply and lease expirations. The balance sheet remains strong, and the company is actively managing its asset portfolio.Highlights
Strong Financial Performance
Total revenues and NOI for Q3 2024 were up 10.9% and 12.5%, respectively, over Q3 2023. FFO per share diluted was $2.37, up 4.9% over Q3 2023.
Leasing and Occupancy Success
Leasing volume for Q3 2024 was 1.5 million square feet, up 48% over the trailing 4-quarter average. Occupancy was solid at 94.7%, up 10 basis points over the prior quarter.
Robust Life Science Industry Impact
Since 2013, there have been 519 novel medicines approved by the FDA, with 257 developed or commercialized by Alexandria tenants.
Balance Sheet Strength
Strong balance sheet with $5.4 billion in liquidity and a weighted average remaining term of debt of 12.6 years.
Successful Asset Sales
Completed over $390 million in asset sales in Q3 2024. Expecting to complete $1.2 billion in pending dispositions.
Lowlights
Economic and Market Challenges
Stubborn economic backdrop with high cost of capital and inflation. Challenges in the life science funding environment.
Development and Leasing Delays
Development and redevelopment leasing was light in Q3 2024, with only 39,121 square feet leased.
Sublease and Competitive Supply Pressures
Competitive supply remaining to be delivered in key markets and sublease space pressures in areas like Boston and Bay Area.
Impact of Lease Expirations
Lease expirations in key projects expected to result in downtime and impact future same-property results.
Company Guidance
During the Alexandria Real Estate Equities (ARE) Q3 2024 earnings call, the company provided robust guidance on various financial and operational metrics. For Q3, ARE reported a 10.9% increase in total revenues and a 12.5% increase in NOI compared to Q3 2023, with FFO per share diluted up 4.9% year-over-year at $2.37. The company highlighted a strong leasing volume, with 1.5 million square feet leased in the third quarter alone, marking a 48% increase over the trailing four-quarter average. ARE continues to maintain high occupancy rates at 94.7% and impressive rental collections at 99.9%. The life science industry remains a focal point, with 257 FDA-approved medicines developed or commercialized by ARE tenants since 2013, reflecting the company's strategic positioning in the sector. The company has $1.5 billion in completed and pending dispositions aimed at reinforcing its mega campus strategy, which currently contributes to 76% of its annual rental revenue. Moving forward, ARE anticipates strong rental rate growth for the full year of 2024, expecting increases of 11% to 19% on a GAAP basis and 5% to 13% on a cash basis.Alexandria Equities Corporate Events
Stock BuybackBusiness Operations and Strategy
Alexandria Equities Announces Strategic Stock Repurchase Program
Positive
Dec 9, 2024
Alexandria Real Estate Equities, Inc. has announced a $500 million stock repurchase program, allowing the company to buy back its common stock until the end of 2025. The move is aimed at leveraging favorable market conditions while maintaining financial balance by using net cash from operations and asset sales. This strategic initiative highlights Alexandria’s commitment to enhancing shareholder value in the dynamic real estate sector.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.