City Office REIT (CIO) AI Stock Analysis

• Market Cap: $281.74M
• Dividend Yield: 5.77%
• Average Volume (3M): 758.45K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.92
• Revenue Growth: -3.69%
• EPS Growth: -777.30%
• Country: US
• Employees: 20
• Sector: Real Estate
• Sector Strength: 53
• Industry: REIT - Office
• EPS (TTM): -2.66
• Shares Outstanding: 40,363,640
• 10 Day Avg. Volume: 2,032,098
• 30 Day Avg. Volume: 758,451
• PEG Ratio: -0.08
• Price to Book (P/B): 0.30
• Price to Sales (P/S): 1.29
• P/FCF Ratio: 3.76
• Enterprise Value/Market Cap: 3.36
• Enterprise Value/Revenue: 5.60
• Enterprise Value/Gross Profit: 9.27
• Enterprise Value/Ebitda: -36.83
• 1Y Price Target: $7.00
• Price Target Upside: 0.29% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 2

• Rating: 69 Neutral
• Price Target: $7.50 ▲(7.45% Upside)

City Office REIT's overall score reflects a mix of strengths and challenges. The most significant positive factors are strong technical momentum and strategic corporate events, including a merger at a premium price. However, profitability challenges and valuation concerns, primarily due to negative net income, moderate the overall score.

Positive Factors

Acquisition

City Office REIT announced it would be acquired by MCME Carell for $7.00 per share in cash.

Financial Performance

The company reported Core FFO per share of $0.30, which was two cents higher than consensus estimates and four cents higher than analyst numbers.

Leasing Activity

During the quarter, the company executed approximately 144K sqft of new and renewal leases, which included 101K sqft of new leasing and 43K sqft of renewals.

Negative Factors

Debt Level

The company has an above average debt level at approximately 79% debt-to-total market capitalization including preferred.

Dividends

Future common dividends are suspended, indicating limited upside for investors.

Sector Uncertainty

Persistence of general investor uncertainty in the office sector and banks' unwillingness to do new loans in the sector.

City Office REIT Business Overview & Revenue Model

Company Description

City Office REIT, Inc. (CIO) is a real estate investment trust that focuses on acquiring, owning, and operating high-quality office properties in major metropolitan areas throughout the United States. The company primarily targets properties in cities with strong economic fundamentals and favorable business environments, providing modern office spaces to various tenants across different industries.

How the Company Makes Money

City Office REIT generates revenue primarily through leasing office space to tenants. The company earns rental income from its portfolio of office properties, which is its main revenue stream. These lease agreements typically include base rent and may also incorporate additional charges for property-related expenses such as maintenance, insurance, and taxes. The company's ability to generate revenue is influenced by factors such as occupancy rates, lease terms, and prevailing market rental rates. Additionally, City Office REIT may engage in strategic acquisitions and dispositions of properties to optimize its portfolio and enhance returns.

City Office REIT Financial Statement Overview

Summary

City Office REIT faces profitability challenges as reflected in negative net margins and return on equity. The company maintains a strong EBITDA margin and a reasonable debt-to-equity ratio, demonstrating operational efficiency and moderate leverage. Cash flow generation remains a relative strength, providing some support despite the net income losses. The firm should focus on improving revenue growth and profitability to enhance financial performance.

Income Statement

City Office REIT's TTM (Trailing-Twelve-Months) income statement shows a gross profit margin of 59.76% and an EBIT margin of 10.57%. However, the TTM net profit margin is negative at -11.11%, indicating challenges in profitability. Revenue growth has been declining, with a decrease from the previous year. The EBITDA margin remains relatively strong at 44.06%, highlighting operational efficiency despite net losses.

Balance Sheet

The company's balance sheet reveals a debt-to-equity ratio of 0.89, suggesting a moderate level of leverage. The equity ratio stands at 50.53%, indicating a healthy cushion of equity. However, the return on equity is negative due to the net loss, reflecting current profitability challenges. Overall, the balance sheet position is stable but not without risks due to leverage.

Cash Flow

City Office REIT's cash flow statement shows a stable operating cash flow to net income ratio of -2.91, which is positive given the net income loss. Free cash flow has decreased in the TTM period, but the company maintains positive free cash flow, indicating resilience in cash generation capabilities. The free cash flow to net income ratio is also negative, echoing the net income challenges.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	168.89M	171.13M	179.10M	180.49M	164.04M	160.84M
Gross Profit	102.08M	101.67M	109.10M	112.75M	106.04M	102.53M
EBITDA	-25.70M	75.16M	94.26M	97.75M	90.55M	91.84M
Net Income	-120.38M	-17.68M	-2.68M	25.20M	484.39M	-21.84M
Balance Sheet
Total Assets	1.33B	1.46B	1.51B	1.57B	1.60B	1.16B
Cash, Cash Equivalents and Short-Term Investments	34.50M	18.89M	30.08M	28.19M	21.32M	25.30M
Total Debt	652.92M	646.97M	669.51M	890.60M	653.65M	677.24M
Total Liabilities	712.72M	721.13M	738.74M	771.26M	730.92M	739.42M
Stockholders Equity	614.94M	733.86M	772.23M	802.83M	869.62M	416.93M
Cash Flow
Free Cash Flow	52.54M	58.86M	57.22M	97.11M	65.03M	52.13M
Operating Cash Flow	52.54M	58.86M	57.22M	106.68M	73.22M	59.92M
Investing Cash Flow	-33.09M	-40.29M	-41.34M	-47.05M	-17.38M	-27.80M
Financing Cash Flow	-28.29M	-28.01M	-16.75M	-57.63M	-59.53M	-73.69M

City Office REIT Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 6.98
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CIO, the sentiment is Positive. The current price of 6.98 is above the 20-day moving average (MA) of 6.19, above the 50-day MA of 5.59, and above the 200-day MA of 5.11, indicating a bullish trend. The MACD of 0.44 indicates Negative momentum. The RSI at 80.89 is Negative, neither overbought nor oversold. The STOCH value of 97.42 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CIO.

City Office REIT Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CIO	69 Neutral	$281.74M	―	-17.53%	5.77%	-3.69%	-777.30%
ONL	57 Neutral	$143.29M	―	-10.71%	9.27%	-18.92%	-15.81%
EQC	56 Neutral	$169.73M	4.10	2.10%	―	-4.47%	-44.64%
HPP	54 Neutral	$967.88M	―	-12.35%	2.07%	-9.75%	-69.03%
Sector *	53 Neutral	$1.19B	3.49	-2.19%	6.01%	-2.24%	-167.40%
FSP	48 Neutral	$165.90M	―	-8.18%	2.48%	-18.12%	24.44%
OPI	45 Neutral	$18.01M	―	-24.55%	17.66%	-11.93%	-1877.17%

City Office REIT Corporate Events

City Office REIT Announces Merger with MCME Carell Holdings

On July 23, 2025, City Office REIT entered into a merger agreement with MCME Carell Holdings, where City Office will be acquired for $7.00 per share in a transaction valued at approximately $1.1 billion. This merger, approved by the board, includes the sale of the company’s Phoenix portfolio and is expected to close in the fourth quarter of 2025, subject to shareholder approval and other customary conditions. The transaction offers a significant premium over the current stock price, reflecting a strategic move in a challenging office sector environment. Additionally, City Office announced the sale of its Phoenix assets for $296 million, with proceeds intended to repay debt and for general corporate purposes. The sale is scheduled to close on August 14, 2025, and is not contingent upon the merger’s completion.

The most recent analyst rating on (CIO) stock is a Hold with a $5.50 price target. To see the full list of analyst forecasts on City Office REIT stock, see the CIO Stock Forecast page.