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Centerspace (CSR)
:CSR

Centerspace (CSR) AI Stock Analysis

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Centerspace

(NYSE:CSR)

Rating:66Neutral
Price Target:
$67.00
▲(9.67%Upside)
Centerspace shows strength in its earnings outlook and strategic expansion plans, which are bolstered by strong cash flows and a solid dividend yield. However, profitability challenges and high leverage are significant concerns. The technical analysis suggests a neutral position, indicating potential for future growth but requiring careful monitoring of financial performance and market conditions.
Positive Factors
Earnings
Centerspace reported Core FFO/sh of $1.21, which was $0.02 above our estimate.
Market Stability
Midwest / Western markets provided better stability as other regions are experiencing supply-demand imbalance.
Valuation
CSR shares trade at a significant discount to NAV and large-cap multifamily sector averages, presenting a potential investment opportunity.
Negative Factors
Net Operating Income (NOI)
Denver continues to drag, with NOI decreasing 4.2% year-over-year.
Retention Rate
Retention rate decelerated significantly to 49.2%.
Transaction Market
A slow transaction market and a lack of price discovery on CSR's assets keep analysts sidelined for now.

Centerspace (CSR) vs. SPDR S&P 500 ETF (SPY)

Centerspace Business Overview & Revenue Model

Company DescriptionCenterspace is an owner and operator of apartment communities committed to providing great homes by focusing on integrity and serving others. Founded in 1970, as of June 30, 2021, Centerspace owned 62 apartment communities consisting of 11,579 apartment homes located in Colorado, Minnesota, Montana, Nebraska, North Dakota, and South Dakota. Centerspace was named a Top Workplace for 2021 by the Minneapolis Star Tribune. For more information, please visit www.centerspacehomes.com.
How the Company Makes MoneyCenterspace generates revenue primarily through the rental income of its multifamily residential properties. The company earns money by leasing apartments to individuals and families, collecting monthly rent payments as its main source of income. Additional revenue streams may include fees for services such as pet fees, parking, and other tenant-related charges. Centerspace's earnings are also influenced by its strategic acquisitions and redevelopment projects, which aim to improve property value and increase rental income. The company's performance is further supported by its property management operations, which help to maintain high occupancy rates and customer satisfaction. Significant partnerships with local businesses and service providers can also contribute to its revenue by enhancing the overall living experience for residents, thus attracting and retaining tenants.

Centerspace Earnings Call Summary

Earnings Call Date:May 01, 2025
(Q1-2025)
|
% Change Since: 2.88%|
Next Earnings Date:Aug 04, 2025
Earnings Call Sentiment Positive
The earnings call presented a generally positive outlook, highlighting improved occupancy rates, positive leasing trends, and strong revenue growth. However, there were challenges related to increased expenses and supply pressures in specific markets. Overall, the company's strategic focus and market positioning suggest optimism for the remainder of the year.
Q1-2025 Updates
Positive Updates
Improved Occupancy Rates
The company's weighted average occupancy for the same-store portfolio improved by 120 basis points year-over-year, reaching an average physical occupancy of 96%.
Positive Leasing Trends
Blended leasing spreads increased by 70 basis points in the first quarter, with new lease spreads improving from negative 3.5% in Q4 2024 to 2.4% in April.
Core FFO Growth
Reported core FFO was $1.21 per diluted share for Q1, driven by a 2.1% year-over-year increase in same-store NOI.
Revenue Increase
Revenues from same-store communities increased by 3.5% compared to the same quarter in 2024, benefiting from improved occupancy.
Strong Market Demand
The Midwest and Mountain West regions benefited from a lack of new supply, with North Dakota leading the portfolio with blended leasing spreads of 5.3% year-to-date.
Negative Updates
Increase in Same-Store Expenses
Same-store expenses increased by 5.8% year-over-year, primarily driven by property taxes, creating a challenging year-over-year comparison.
Supply Challenges in Denver
The Denver market continues to face supply pressure, affecting new lease rates, although demand remains strong enough to potentially improve rates as the year progresses.
Retention Rate Concerns
Retention came down in the first quarter, with operational retention rates slightly lower than some peers, largely due to forced move-outs related to value-add projects.
Company Guidance
During the Centerspace First Quarter 2025 Earnings Call, the company highlighted several key metrics demonstrating strong performance and reaffirmed its full-year guidance. The first quarter showed a 120 basis point year-over-year improvement in weighted average occupancy for the same-store portfolio, reaching an average physical occupancy of 96%. April renewal retention was around 57%, with blended leasing spreads up 70 basis points in the first quarter and further improvement into April. Renewal increases remained steady between 2% and mid-3%, while new lease spreads improved from a negative 3.5% in Q4 2024 to a positive 2.4% in April. The rent-to-income ratio was stable at 21.6%, and bad debt aligned with expectations at around 40 basis points. The company's core FFO for the first quarter was $1.21 per diluted share, supported by a 2.1% year-over-year increase in same-store NOI and a 3.5% increase in revenues from same-store communities. Centerspace's debt maturity profile was well managed, with a weighted average debt cost of 3.6% and a weighted average time to maturity of 5.4 years. The company maintained over $223 million in liquidity, reinforcing its position to capitalize on strategic opportunities amid market volatility.

Centerspace Financial Statement Overview

Summary
Centerspace presents a mixed financial picture with stable revenue growth but persistent profitability challenges. The high leverage poses a risk, though the company maintains a solid equity base. Cash flows remain robust, providing some cushion against operational hurdles. Overall, the financial health is stable but requires attention to debt levels and profitability improvement.
Income Statement
65
Positive
Centerspace shows moderate revenue growth over the periods, with a slight increase in TTM revenue. However, consistent net losses indicate profitability challenges. The gross profit margin remains strong, yet declining EBIT and EBITDA margins reflect operational cost pressures. Revenue growth is positive but slowing, suggesting stability with caution needed on profitability.
Balance Sheet
60
Neutral
The balance sheet shows a stable equity position relative to total assets, indicating a solid foundation. However, the debt-to-equity ratio is high, suggesting significant leverage risk. The return on equity has fluctuated, with recent periods showing negative returns due to net losses, highlighting profit generation issues.
Cash Flow
70
Positive
Centerspace has shown positive operating cash flow throughout the periods, with recent improvements in free cash flow. However, the free cash flow growth rate is inconsistent. The operating cash flow covers net income, showcasing strong cash generation capability despite profitability issues. Financing activities show a decrease, indicating reduced external funding reliance.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue263.57M260.98M261.31M256.72M201.71M177.99M
Gross Profit123.72M148.61M146.14M138.18M111.10M99.03M
EBITDA133.10M130.23M188.83M121.62M122.06M85.59M
Net Income-6.98M-10.69M41.97M-15.02M-31.38M-24.00M
Balance Sheet
Total Assets1.89B1.91B1.93B2.03B1.94B1.46B
Cash, Cash Equivalents and Short-Term Investments11.92M12.03M8.63M10.46M31.27M392.00K
Total Debt955.45M955.38M916.02M1.01B856.05M719.19M
Total Liabilities1.01B1.01B978.78M1.07B918.45M774.80M
Stockholders Equity653.36M670.46M726.39M746.10M797.36M634.77M
Cash Flow
Free Cash Flow121.08M98.25M89.52M35.30M48.15M30.91M
Operating Cash Flow99.27M98.25M89.52M91.99M84.03M61.23M
Investing Cash Flow-46.57M-50.72M120.21M-160.09M-267.23M-164.97M
Financing Cash Flow-48.39M-43.67M-212.35M41.37M214.51M64.93M

Centerspace Technical Analysis

Technical Analysis Sentiment
Negative
Last Price61.09
Price Trends
50DMA
61.27
Negative
100DMA
61.26
Negative
200DMA
63.70
Negative
Market Momentum
MACD
-0.34
Positive
RSI
47.77
Neutral
STOCH
35.97
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CSR, the sentiment is Negative. The current price of 61.09 is below the 20-day moving average (MA) of 61.90, below the 50-day MA of 61.27, and below the 200-day MA of 63.70, indicating a bearish trend. The MACD of -0.34 indicates Positive momentum. The RSI at 47.77 is Neutral, neither overbought nor oversold. The STOCH value of 35.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CSR.

Centerspace Risk Analysis

Centerspace disclosed 51 risk factors in its most recent earnings report. Centerspace 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

Centerspace Peers Comparison

Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
UMUMH
70
Outperform
$1.46B155.803.45%5.19%8.01%
CSCSR
66
Neutral
$1.08B-1.55%5.04%-1.81%-33.33%
65
Neutral
$1.99B17.552.40%5.17%-0.31%5.93%
BRBRT
64
Neutral
$306.04M-4.28%6.18%2.39%-407.57%
53
Neutral
$862.92M866.19-7.19%6.00%-7.44%-143.64%
VRVRE
48
Neutral
$1.37B-2.76%2.17%-3.20%76.43%
AIAIV
48
Neutral
$1.25B-48.27%6.81%9.28%34.42%
* Real Estate Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
CSR
Centerspace
61.09
-4.28
-6.55%
AIV
Apartment Investment & Management
8.81
1.16
15.16%
VRE
Veris Residential
14.72
0.18
1.24%
UMH
Umh
17.34
1.73
11.08%
BRT
BRT Apartments
16.19
-0.09
-0.55%
NXRT
NexPoint Residential
33.99
-2.69
-7.33%

Centerspace Corporate Events

Private Placements and FinancingM&A TransactionsDividendsBusiness Operations and Strategy
Centerspace Expands with Salt Lake City Acquisition
Positive
Jun 2, 2025

On May 30, 2025, Centerspace closed on its first acquisition in Salt Lake City for $149 million, marking its expansion into this market. The company also plans to acquire a community in Fort Collins, CO, and is marketing its Saint Cloud, MN, and parts of its Minneapolis portfolios for sale. These transactions are part of Centerspace’s strategy to enhance its Midwest and Mountain West multifamily REIT focus. Additionally, Centerspace increased its credit facility to $400 million to support these activities and declared a quarterly dividend of $0.77 per share/unit, payable on July 10, 2025.

The most recent analyst rating on (CSR) stock is a Hold with a $75.00 price target. To see the full list of analyst forecasts on Centerspace stock, see the CSR Stock Forecast page.

Financial Disclosures
Centerspace Reports Q1 2025 Financial Results
Neutral
May 1, 2025

Centerspace, a company listed on the NYSE under the ticker CSR, reported its financial and operational results for the first quarter of 2025 on May 1, 2025. The company experienced a 4.0% increase in revenue compared to the first quarter of 2024, reaching $67.1 million. Despite a net loss of $0.22 per diluted share, this was an improvement from the $0.37 loss per share in the same period last year. The Core FFO per diluted share slightly decreased to $1.21, attributed to a rise in same-store property taxes. Centerspace also updated its financial outlook for 2025, maintaining its previous guidance ranges.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Jun 25, 2025