Cousins Properties (CUZ) AI Stock Analysis

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Cousins Properties

(NYSE:CUZ)

Rating:64Neutral

Price Target:

$29.00

▲( 8.53% Upside)

Cousins Properties' overall stock score is primarily influenced by its strong earnings call performance and solid financial foundation. However, technical indicators and high valuation present challenges. The company's strategic focus on premium office assets and a robust balance sheet provide a positive outlook amidst macroeconomic uncertainties.

Positive Factors

Dividends

CUZ offers a well-covered dividend yield of 4.9%, which is considered to have minimal risk.

Financial Performance

Cousins Properties reported higher than expected funds from operations per share, and increased their 2025 financial guidance.

Market Position

CUZ is upgraded to Outperform from Peer Perform, indicating a strong belief in the stock's potential.

Negative Factors

Leasing Activity

Leasing concessions for Cousins Properties remain high, representing a larger percentage of rent compared to the sector average.

Market Fundamentals

Analyst has less conviction in CUZ's market fundamentals due to increased availability and vacancy rates.

Valuation

Analyst downgrades CUZ due to its strong performance year-to-date, indicating potential overvaluation.

Cousins Properties (CUZ) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$4.49B

Dividend Yield4.75%

Average Volume (3M)1.34M

Price to Earnings (P/E)79.8

Beta (1Y)1.02

Revenue Growth10.93%

EPS Growth-31.07%

CountryUS

Employees306

SectorReal Estate

Sector Strength62

IndustryREIT - Office

Share Statistics

EPS (TTM)0.12

Shares Outstanding167,911,650

10 Day Avg. Volume1,314,477

30 Day Avg. Volume1,338,342

Financial Highlights & Ratios

PEG Ratio10.16

Price to Book (P/B)0.97

Price to Sales (P/S)0.00

P/FCF Ratio25.92

Enterprise Value/Market Cap1.73

Enterprise Value/Revenue2.29

Enterprise Value/Gross Profit15.10

Enterprise Value/Ebitda4.18

Forecast

1Y Price Target

$32.44

Price Target Upside21.41% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering9

Cousins Properties Business Overview & Revenue Model

Company DescriptionCousins Properties is a fully integrated, self-administered and self-managed real estate investment trust (REIT). The Company, based in Atlanta, GA and acting through its operating partnership, Cousins Properties LP, primarily invests in Class A office towers located in high-growth Sun Belt markets. Founded in 1958, Cousins creates shareholder value through its extensive expertise in the development, acquisition, leasing and management of high-quality real estate assets. The Company has a comprehensive strategy in place based on a simple platform, trophy assets and opportunistic investments.

How the Company Makes MoneyCousins Properties makes money primarily through leasing office spaces in its portfolio of Class A office properties. The company's key revenue streams include rental income from long-term leases with tenants, which often consist of large, creditworthy corporations seeking premium office locations. Additional revenue is generated through property management fees and potentially through the strategic sale of properties when market conditions are favorable. The company's financial performance is also influenced by factors such as occupancy rates, rental rates, and operating expenses. Strategic partnerships and joint ventures can also play a role in expanding the company's asset base and enhancing its revenue potential.

Cousins Properties Financial Statement Overview

Summary

Cousins Properties exhibits a solid financial foundation with a strong balance sheet and healthy cash flows. However, declining revenue and profitability margins in the latest TTM period pose challenges that need addressing for future growth.

Income Statement

Neutral

Cousins Properties has shown a declining trend in revenue with the latest TTM revenue at $654.3 million compared to $856.8 million in the previous year, indicating a decrease. Gross profit margin for TTM stands at 53.35%, while net profit margin is 4.96%, showcasing moderate profitability. Both EBIT and EBITDA margins are stable but reflect a decline from previous periods, suggesting some operational challenges.

Balance Sheet

Positive

The balance sheet remains robust with a debt-to-equity ratio of 0.62, indicating moderate leverage. Return on equity for TTM is 0.67%, showing a decrease in profitability relative to equity. The equity ratio is strong at 55.82%, highlighting a solid equity base compared to total assets.

Cash Flow

Positive

Free cash flow has grown by 23.33% from the previous year, and operating cash flow remains healthy, with an operating cash flow to net income ratio of 12.83. The company demonstrates effective cash management, although the free cash flow to net income ratio is 5.60, indicating room for improvement in cash conversion.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
897.85M	856.76M	802.87M	762.29M	755.07M	740.34M
	Gross Profit
515.54M	576.10M	536.44M	503.92M	495.61M	489.49M
	EBIT
191.36M	171.75M	190.90M	183.56M	180.39M	178.08M
	EBITDA
531.37M	536.80M	504.18M	479.14M	468.49M	466.73M
	Net Income Common Stockholders
32.48M	45.96M	82.96M	279.65M	209.37M	172.40M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
5.45M	7.35M	6.05M	5.14M	8.94M	4.29M
	Total Assets
7.68B	8.80B	7.63B	7.54B	7.31B	7.11B
	Total Debt
2.65B	3.15B	2.51B	2.33B	2.24B	2.22B
	Net Debt
2.65B	3.14B	2.50B	2.33B	2.23B	2.22B
	Total Liabilities
3.17B	3.93B	3.09B	2.89B	2.71B	2.61B
	Stockholders Equity
4.49B	4.87B	4.52B	4.63B	4.57B	4.47B
Cash Flow		Free Cash Flow
181.94M	147.50M	368.36M	22.93M	-398.33M	-268.68M
	Operating Cash Flow
416.70M	400.23M	368.36M	365.17M	389.48M	351.09M
	Investing Cash Flow
-1.13B	-1.31B	-295.74M	-334.50M	-191.07M	-132.46M
	Financing Cash Flow
717.49M	906.47M	-71.72M	-35.69M	-194.38M	-230.09M

Cousins Properties Technical Analysis

Technical Analysis Sentiment

Negative

Last Price26.72

Price Trends

50DMA

27.87

Negative

100DMA

28.79

Negative

200DMA

28.89

Negative

Market Momentum

MACD

-0.07

Positive

RSI

39.50

Neutral

STOCH

9.50

Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CUZ, the sentiment is Negative. The current price of 26.72 is below the 20-day moving average (MA) of 27.85, below the 50-day MA of 27.87, and below the 200-day MA of 28.89, indicating a bearish trend. The MACD of -0.07 indicates Positive momentum. The RSI at 39.50 is Neutral, neither overbought nor oversold. The STOCH value of 9.50 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CUZ.

Cousins Properties Risk Analysis

Cousins Properties disclosed 27 risk factors in its most recent earnings report. Cousins Properties 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 3 New Risks

Adverse changes to our credit ratings could limit our access to funding and increase our borrowing costs. Q4, 2024

Our investments in real estate debt face prepayment risk and interest rate fluctuations that may adversely affect our results of operations and financial condition. Q4, 2024

We will face risks related to our investments in mezzanine loans. Q4, 2024

Cousins Properties Peers Comparison

Overall Rating

UnderperformOutperform

Sector (60)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PGRE	72 Outperform	$1.36B	―	-2.11%	2.43%	1.67%	73.75%
KRC	70 Neutral	$7.75B	19.51	3.69%	6.85%	1.11%	-3.07%
HIW	65 Neutral	$3.13B	18.15	7.21%	6.86%	-2.01%	31.64%
CUZ	64 Neutral	$4.49B	79.81	1.15%	4.75%	10.93%	-31.07%
Sector *	60 Neutral	$2.75B	10.29	0.33%	8508.22%	5.95%	-17.48%
DEI	60 Neutral	$2.86B	44.61	2.49%	5.37%	-1.98%	―
SLG	58 Neutral	$4.43B	663.10	-0.13%	5.45%	13.36%	94.82%

* Real Estate Sector Average

Performance Comparison

CUZ

Cousins Properties

26.72

4.85

22.18%

DEI

Douglas Emmett

14.11

1.36

10.67%

HIW

Highwoods Properties

29.00

5.11

21.39%

KRC

Kilroy Realty

31.51

0.94

3.07%

SLG

SL Green Realty

55.23

6.92

14.32%

PGRE

Paramount Group

5.73

1.29

29.05%

Cousins Properties Earnings Call Summary

Earnings Call Date:May 01, 2025

(Q1-2025)

% Change Since: -3.78%|

Next Earnings Date:Jul 24, 2025

Earnings Call Sentiment Positive

Cousins Properties demonstrated strong performance in the first quarter with significant leasing activity, increased guidance, and a resilient market outlook. However, macroeconomic uncertainties due to tariffs and expected short-term occupancy declines pose challenges.

Q1-2025 Updates

Positive Updates

Strong First Quarter Performance

Cousins Properties delivered $0.74 per share in FFO and increased same-property net operating income by 2% on a cash basis. The company completed 539,000 square feet of leases with a 3.2% cash rent roll-up, marking the 44th consecutive quarter of positive rent roll-up. The company increased the midpoint of its guidance to $2.79 a share, representing a 3.7% growth rate over the previous year.

Leasing Success in Key Markets

The company's portfolio was 90% occupied at the end of the first quarter, up from 88.4% a year ago. Significant leasing activity was seen in Atlanta (213,000 sq ft), Austin (176,000 sq ft), and Tampa (84,000 sq ft), with positive rent roll-ups and strategic renewals.

Improved Market Fundamentals

The company observed improving fundamentals with the decline of older office supply and increasing demand. Leasing volume is now at 89% of pre-pandemic activity, and vacancy rates in the lifestyle office sector are believed to have peaked.

Robust Balance Sheet and Strategic Flexibility

Cousins Properties maintains a low leverage ratio with net debt to EBITDA at 4.9 times and strong liquidity. The company retains strategic flexibility to capitalize on accretive investment opportunities due to its solid financial position.

Negative Updates

Impact of Trade Dynamics and Tariffs

Recent tariff discussions have created macroeconomic uncertainty, leading to increased volatility in capital markets, potential concerns over a softening economy, weaker demand, and higher construction costs.

Lease Expirations and Occupancy Challenges

Occupancy is expected to decline through the third quarter due to anticipated move-outs, such as Bank of America in Charlotte. The company has only 9.3% of annual contractual rent expiring through 2026, but notable expirations include Bank of America and One Trust.

Company Guidance

In the recent Cousins Properties first-quarter conference call, the company reported positive financial performance and provided updated guidance. The team achieved $0.74 per share in funds from operations (FFO), with a 2% increase in same-property net operating income on a cash basis and completed 539,000 square feet of leases with a 3.2% cash rent roll-up. The company raised the midpoint of its guidance to $2.79 per share, representing a 3.7% growth rate over the previous year. Occupancy in their portfolio increased from 88.4% to 90% year-over-year. The company remains strategically focused on driving earnings growth and maintaining a robust balance sheet, with a reported net debt to EBITDA of 4.9 times. Cousins Properties highlighted the strength and resiliency of their Sun Belt lifestyle office portfolio amidst improving fundamentals, including a declining supply of office buildings and accelerating demand. They also noted a healthy leasing pipeline and an industry-leading balance sheet, positioning them well to capitalize on potential investment opportunities in the current market environment.

Cousins Properties Corporate Events

Business Operations and Strategy

Cousins Properties Highlights Premium Office Assets Strategy

Positive

May 5, 2025

On May 5, 2025, Cousins Properties presented an investor presentation at the Wells Fargo 28th Annual Real Estate Securities Conference in Charleston, SC. The presentation highlighted the company’s focus on premium office assets that are new or recently redeveloped, featuring high occupancy rates and premium rents. These properties are located in dynamic neighborhoods and offer extensive amenities, aligning with the industry’s shift towards quality office spaces. The presentation underscored the challenges faced by older office assets, which are becoming obsolete and may be redeveloped for other uses.

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.