Elme Communities (ELME) AI Stock Analysis

• Market Cap: $1.53B
• Dividend Yield: 4.15%
• Average Volume (3M): 1.40M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.52
• Revenue Growth: 3.10%
• EPS Growth: -900.13%
• Country: US
• Employees: 255
• Sector: Real Estate
• Sector Strength: 53
• Industry: REIT - Office
• EPS (TTM): -1.40
• Shares Outstanding: 88,161,160
• 10 Day Avg. Volume: 1,769,819
• 30 Day Avg. Volume: 1,395,835
• PEG Ratio: 1.36
• Price to Book (P/B): 1.24
• Price to Sales (P/S): 5.55
• P/FCF Ratio: 14.10
• Enterprise Value/Market Cap: 1.43
• Enterprise Value/Revenue: 8.85
• Enterprise Value/Gross Profit: 22.06
• Enterprise Value/Ebitda: -185.83
• 1Y Price Target: $18.00
• Price Target Upside: 6.45% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 2
• EPS Forecast (FY): -0.14
• Revenue Forecast (FY): $239.26M

• Rating: 54 Neutral
• Price Target: $17.00 ▲(0.53% Upside)

Elme Communities' overall score is driven by strategic asset sales and planned shareholder distributions, which are positive. However, profitability challenges and market conditions affecting cost of capital weigh on the score. Technical indicators and valuation provide a neutral to slightly negative outlook.

Positive Factors

Revenue Growth

The consistent growth in net operating income from multifamily properties indicates strong demand and effective management, supporting long-term revenue expansion.

Strategic Asset Sales

The asset sale agreement is a strategic move to maximize shareholder value, providing significant liquidity and enabling focus on core operations.

Market Position

Elme's strong market position in a high-demand area supports sustained rental income growth and enhances the value of its property portfolio.

Negative Factors

Profitability Challenges

Negative profit margins indicate operational inefficiencies and high costs, which could hinder long-term financial health and investment capacity.

Market Challenges and Cost of Capital

High cost of capital limits Elme's ability to finance growth projects efficiently, potentially impacting future expansion and competitiveness.

Disposal Process Delays

Lengthy asset disposal processes could delay strategic initiatives and cash returns to shareholders, affecting financial flexibility and planning.

Elme Communities Business Overview & Revenue Model

Company Description

Elme Communities (ELME) is a real estate investment trust (REIT) that focuses on the ownership, operation, and development of multifamily residential communities primarily in the Mid-Atlantic region of the United States. The company aims to provide high-quality living spaces through a diverse portfolio of apartment communities, catering to the housing needs of a growing population. Elme Communities emphasizes sustainable practices and community engagement, enhancing the living experience for residents and contributing to the overall value of its properties.

How the Company Makes Money

Elme Communities generates revenue primarily through rental income from its multifamily residential properties. The company leases apartment units to tenants, collecting monthly rent, which constitutes a significant portion of its overall earnings. Additional revenue streams include ancillary income from services such as parking, laundry facilities, and other property amenities. The company may also engage in property management services and development projects, further contributing to its financial performance. Strategic partnerships with local businesses and community organizations can enhance tenant retention and increase occupancy rates, thereby positively impacting revenue. Moreover, Elme Communities benefits from favorable market conditions in the regions it operates, which can lead to higher rental rates and property value appreciation.

Elme Communities Financial Statement Overview

Summary

Elme Communities shows strong revenue growth but struggles with profitability, reflected in negative net profit and EBIT margins. The balance sheet indicates moderate leverage, and while operating cash flow is positive, free cash flow growth is declining.

Income Statement

Elme Communities has experienced a significant revenue growth of 42.6% in the TTM, indicating strong top-line expansion. However, the company is facing profitability challenges with a negative net profit margin of -54.57% and a negative EBIT margin, reflecting operational inefficiencies and high expenses relative to revenue.

Balance Sheet

The debt-to-equity ratio of 0.78 in the TTM suggests moderate leverage, which is manageable but has increased compared to previous years. The return on equity remains negative, indicating that the company is not generating positive returns for shareholders. The equity ratio is stable, providing some financial stability.

Cash Flow

Operating cash flow remains positive, but there is a decline in free cash flow growth by -5.21% in the TTM. The free cash flow to net income ratio is strong at 1.0, indicating that the company is generating cash flow despite net losses, which is a positive sign for liquidity.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	246.96M	241.94M	227.91M	209.38M	169.15M	176.00M
Gross Profit	99.09M	144.37M	139.97M	127.94M	102.24M	106.88M
EBITDA	-11.76M	120.67M	66.40M	85.79M	76.48M	117.02M
Net Income	-134.77M	-13.10M	-52.98M	-30.87M	-21.79M	-15.68M
Balance Sheet
Total Assets	1.69B	1.85B	1.90B	1.87B	1.88B	2.41B
Cash, Cash Equivalents and Short-Term Investments	7.09M	6.14M	5.98M	8.39M	233.60M	7.70M
Total Debt	709.33M	698.95M	679.35M	552.36M	496.95M	987.37M
Total Liabilities	777.68M	763.68M	745.68M	608.82M	558.93M	1.09B
Stockholders Equity	908.90M	1.08B	1.15B	1.26B	1.32B	1.32B
Cash Flow
Free Cash Flow	86.36M	95.03M	84.26M	71.47M	89.16M	54.67M
Operating Cash Flow	86.44M	95.24M	84.67M	73.21M	89.16M	112.99M
Investing Cash Flow	-37.25M	-43.74M	-146.22M	-241.16M	702.17M	65.76M
Financing Cash Flow	-47.00M	-51.43M	60.24M	-56.42M	-565.40M	-185.20M

Elme Communities Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 16.91
• 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 ELME, the sentiment is Positive. The current price of 16.91 is above the 20-day moving average (MA) of 16.76, above the 50-day MA of 16.76, and above the 200-day MA of 16.24, indicating a bullish trend. The MACD of 0.12 indicates Negative momentum. The RSI at 70.12 is Negative, neither overbought nor oversold. The STOCH value of 95.41 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ELME.

Elme Communities Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
DEA	58 Neutral	$1.01B	72.12	1.00%	9.20%	11.02%	-30.91%
PDM	55 Neutral	$1.03B	―	-4.45%	5.70%	-1.23%	9.10%
ELME	54 Neutral	$1.53B	-11.32	-13.43%	4.15%	3.10%	-900.13%
PGRE	53 Neutral	$1.57B	―	-3.14%	―	-5.29%	54.66%
JBGS	46 Neutral	$1.34B	―	-10.10%	3.80%	-11.04%	-58.49%
HPP	45 Neutral	$753.50M	―	-14.02%	―	-7.89%	-15.88%

Elme Communities Corporate Events

Elme Communities Faces Uncertain Future Amid Liquidation Risks and Potential NYSE Delisting

Elme Communities faces significant risks if the Plan of Sale and Liquidation is approved by shareholders. These risks include potential additional liabilities, difficulties in selling remaining assets at expected prices, and reliance on key personnel who may not stay. The company might need extra capital for the wind-down process, which could reduce shareholder distributions, and there is a risk of shareholder liability to creditors. Furthermore, changes in accounting practices, higher operational costs, and potential delisting from the NYSE add to the uncertainties surrounding the liquidation process.

Elme Communities Plans Asset Sale and Liquidation

Elme Communities reported its third-quarter 2025 financial results, revealing a net loss per diluted share of $1.40, compared to a $0.03 loss in the same period last year. The company is undergoing significant changes, including a pending sale of 19 multifamily communities for approximately $1.6 billion and a plan for sale and liquidation of its remaining assets, subject to shareholder approval on October 30, 2025. Operationally, the company experienced a 1.8% decrease in same-store multifamily NOI and a slight drop in average occupancy. Elme’s available liquidity stood at $321 million, and it recognized a $111.7 million impairment charge for certain properties. The company paid a quarterly dividend of $0.18 per share but does not plan future dividends if the liquidation plan is approved.

The most recent analyst rating on (ELME) stock is a Hold with a $18.00 price target. To see the full list of analyst forecasts on Elme Communities stock, see the ELME Stock Forecast page.

Elme Communities’ Sale and Liquidation Plan: Navigating Uncertainty and Investor Risks

Elme Communities faces significant uncertainty regarding the potential returns from its Plan of Sale and Liquidation, as there is no guarantee that liquidating its assets will yield better returns than other available alternatives. This strategic move could potentially diminish the perceived value of the company to prospective buyers and limit its ability to effectively sell its Sale Portfolio. Additionally, the plan may restrict the company from exploring other viable strategies that have not yet been considered by its board of trustees. Investors should be aware of these risks, as well as the uncertainties surrounding the timing and amount of distributions to shareholders, which are influenced by factors beyond the company’s control.

Elme Communities’ Earnings Call: Strategic Asset Sales and Shareholder Rewards

The recent earnings call for Elme Communities highlighted a strategic shift aimed at maximizing shareholder value through significant asset sales. The company announced a definitive agreement with Cortland, promising substantial distributions to shareholders. However, the call also outlined challenges in reducing the cost of capital and uncertainties in the market environment, alongside a lengthy timeline for asset sales.

Elme Communities Reports Q2 2025 Earnings and Strategic Shift

Elme Communities is a multifamily real estate investment trust (REIT) that focuses on providing quality and affordable homes for middle-income renters in the Washington, DC, and Atlanta metro areas. The company owns and operates approximately 9,400 apartment homes and 300,000 square feet of commercial space.

Elme Communities Announces Major Strategic Shift with Asset Sale

Elme Communities reported its second quarter 2025 financial results, showing a net loss per diluted share of $0.04, consistent with the previous year, and a slight increase in Core FFO per diluted share to $0.24. The company announced a significant strategic move with the sale of 19 multifamily communities for approximately $1.6 billion and a plan for the liquidation and dissolution of the company. This decision marks a major shift in Elme’s operations and could have significant implications for its stakeholders, as it withdraws its prior 2025 guidance and does not plan to issue new guidance for 2025 or 2026.

The most recent analyst rating on (ELME) stock is a Hold with a $18.00 price target. To see the full list of analyst forecasts on Elme Communities stock, see the ELME Stock Forecast page.

Elme Communities Sells Portfolio for $1.6 Billion

On August 1, 2025, Elme Communities entered into a Purchase and Sale Agreement with Cortland Partners to sell a 19-asset portfolio for $1.6 billion, marking a significant step in Elme’s strategic plan to liquidate and dissolve the company. The transaction, expected to close in the fourth quarter of 2025, is part of a broader Plan of Sale and Liquidation approved by Elme’s Board, aiming to maximize shareholder value through asset sales and distributions, with estimated returns of $17.58 to $18.50 per share.

The most recent analyst rating on (ELME) stock is a Hold with a $18.00 price target. To see the full list of analyst forecasts on Elme Communities stock, see the ELME Stock Forecast page.