Elme Communities (ELME) AI Stock Analysis

• Market Cap: $1.37B
• Dividend Yield: 4.61%
• Average Volume (3M): 703.09K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.56
• Revenue Growth: 6.15%
• EPS Growth: 74.89%
• Country: US
• Employees: 255
• Sector: Real Estate
• Sector Strength: 76
• Industry: REIT - Office
• EPS (TTM): -0.15
• Shares Outstanding: 88,158,650
• 10 Day Avg. Volume: 593,150
• 30 Day Avg. Volume: 703,085
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 6.22
• Price to Cash Flow (P/CF): 15.40
• P/FCF Ratio: 14.80
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $19.00
• Price Target Upside: 22.34% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4

Elme Communities' overall score reflects significant financial challenges, particularly with declining revenues and persistent net losses. While technical indicators suggest bearish momentum, the company shows strengths in cash flow management and strategic governance initiatives. The stock's valuation also indicates a potential opportunity for income-focused investors, despite concerns about profitability and market dynamics.

Positive Factors

Market Strength

ELME's apartment portfolio is 84% based in D.C Metro which is one of the strongest performing markets in the country.

Operational Improvements

ELME is in the process of making operational improvements through 2024 and 2025 that should provide $3.4 - $3.8 million in FFO upside.

Strategic Review

The announcement of a strategic review could be a long-term positive for shareholders.

Negative Factors

Management Pressure

The announcement could increase pressure on management to pursue a sale, potentially closing off other strategic avenues.

Office Asset Concern

ELME has one remaining office asset that currently generates 9% of their NOI.

Revenue Growth Pressure

Atlanta has been underperforming due to elevated bad debt and supply that has been putting pressure on same store revenue growth.

Elme Communities Business Overview & Revenue Model

Company Description

Elme Communities (ELME) is a real estate investment trust (REIT) focused on owning, managing, and developing multifamily residential properties in the United States. The company specializes in providing high-quality living spaces in urban and suburban markets, aiming to deliver exceptional value to its residents and investors. ELME's portfolio comprises a diverse range of properties, including apartment complexes and mixed-use developments, strategically located to cater to growing residential demands.

How the Company Makes Money

Elme Communities generates revenue primarily through the leasing of its residential properties. The company's key revenue streams include rental income from tenants residing in its apartment units and fees associated with property management services. ELME's earnings are significantly influenced by occupancy rates, rental price adjustments, and property appreciation. Additionally, the company may engage in strategic partnerships or joint ventures to enhance its property portfolio and maximize returns. Income from property sales or refinancing activities also contributes to ELME's overall financial performance.

Elme Communities Financial Statement Overview

Summary

Elme Communities faces financial challenges with declining revenues and persistent net losses. While cash flow management shows resilience and the equity ratio is healthy, rising leverage and profitability issues present risks.

Income Statement

Elme Communities has faced significant challenges on its income statement. The company has seen declining revenues over the years, with a notable drop from $294M in 2020 to $0 in 2024. The net income has consistently been negative, indicating ongoing profitability issues. Although there were some improvements in EBIT and EBITDA margins from 2023 to 2024, the overall trajectory shows a need for revenue stabilization and growth.

Balance Sheet

The balance sheet presents a mixed picture for Elme Communities. The debt-to-equity ratio has increased over the years, indicating rising leverage, which could be a risk if not managed properly. However, the company has maintained a relatively stable stockholders' equity, although it has slightly decreased over the years. The equity ratio remains healthy, suggesting reasonable asset financing through equity.

Cash Flow

Elme Communities' cash flow statement shows some resilience. Despite declining net income, operating cash flow has remained positive, indicating decent cash conversion. Free cash flow also showed a notable increase from 2022 to 2023. However, the sustainability of this trend is uncertain given the declining revenue base.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
241.94M	227.91M	209.38M	169.15M	294.12M
	Gross Profit
144.37M	139.97M	127.94M	102.24M	181.21M
	EBIT
23.47M	-23.06M	-1.01M	-484.00K	37.23M
	EBITDA
120.67M	66.40M	90.00M	76.48M	117.02M
	Net Income Common Stockholders
-13.10M	-52.98M	-60.73M	-21.79M	-52.98M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
6.14M	7.22M	8.39M	233.60M	7.70M
	Total Assets
1.85B	1.90B	1.87B	1.88B	2.41B
	Total Debt
698.95M	679.35M	552.36M	496.95M	987.37M
	Net Debt
692.81M	673.36M	543.97M	263.35M	979.67M
	Total Liabilities
763.68M	745.68M	608.82M	558.93M	1.09B
	Stockholders Equity
1.08B	1.15B	1.26B	1.32B	1.32B
Cash Flow		Free Cash Flow
95.24M	84.67M	34.26M	56.70M	54.67M
	Operating Cash Flow
95.24M	84.67M	73.21M	89.16M	112.99M
	Investing Cash Flow
-43.74M	-146.22M	-241.16M	702.17M	65.76M
	Financing Cash Flow
-51.43M	60.24M	-56.42M	-565.40M	-185.20M

Elme Communities Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 15.53
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ELME, the sentiment is Negative. The current price of 15.53 is below the 20-day moving average (MA) of 15.86, below the 50-day MA of 16.49, and below the 200-day MA of 16.21, indicating a bearish trend. The MACD of -0.35 indicates Negative momentum. The RSI at 45.18 is Neutral, neither overbought nor oversold. The STOCH value of 89.03 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ELME.

Elme Communities Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DEA	67 Neutral	$883.20M	44.73	1.44%	12.94%	4.60%	-5.17%
PGRE	60 Neutral	$1.05B	―	-1.46%	3.25%	1.97%	82.20%
Sector *	59 Neutral	$2.73B	11.65	0.11%	8783.19%	5.45%	-17.32%
ELME	53 Neutral	$1.37B	―	-1.17%	4.61%	6.15%	74.89%
PDM	52 Neutral	$843.49M	―	-4.78%	7.37%	-5.58%	-63.09%
BDN	50 Neutral	$699.43M	―	-18.11%	15.19%	-2.22%	1.51%
JBGS	50 Neutral	$1.34B	―	-7.24%	4.77%	-9.42%	-99.45%

Elme Communities Corporate Events

Elme Communities Appoints Ron D. Sturzenegger to Board

On March 19, 2025, Elme Communities announced the appointment of Ron D. Sturzenegger as an independent trustee to its Board of Trustees, expanding the board to eight members. Sturzenegger, with over 30 years of experience in the real estate industry, will also serve on the transaction committee overseeing strategic alternatives. This appointment is part of Elme’s ongoing efforts to refresh its board composition and maximize shareholder value. Additionally, Elme entered into a cooperation agreement with Argosy-Lionbridge Management, LLC, which includes standstill and voting provisions, and opted out of the Maryland Unsolicited Takeover Act, enhancing its corporate governance practices.

Elme Communities Shifts Focus Amid Financial Review

Elme Communities reported its financial results for the fourth quarter and full year of 2024, showing a net loss but an increase in core funds from operations. The Board of Trustees has initiated a strategic review to maximize shareholder value, highlighting a shift in strategic focus due to shares trading at a discount. The company maintains a strong balance sheet and has set guidance for 2025, anticipating growth driven by strong demand and favorable dynamics in key regions.