Essex Property (ESS) AI Stock Analysis

• Market Cap: $16.93B
• Dividend Yield: 3.95%
• Average Volume (3M): 545.13K
• Price to Earnings (P/E): 20.4
• Beta (1Y): 0.83
• Revenue Growth: 7.56%
• EPS Growth: 54.15%
• Country: US
• Employees: 1,712
• Sector: Real Estate
• Sector Strength: 56
• Industry: REIT - Residential
• EPS (TTM): 3.44
• Shares Outstanding: 64,404,020
• 10 Day Avg. Volume: 918,049
• 30 Day Avg. Volume: 545,132
• PEG Ratio: 0.30
• Price to Book (P/B): 3.31
• Price to Sales (P/S): 10.33
• P/FCF Ratio: 19.67
• Enterprise Value/Market Cap: 1.49
• Enterprise Value/Revenue: 13.91
• Enterprise Value/Gross Profit: 24.86
• Enterprise Value/Ebitda: 17.02
• 1Y Price Target: $299.97
• Price Target Upside: 18.10% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 16

• Rating: 68 Neutral
• Price Target: $284.00 ▲(11.82% Upside)

Essex Property's overall stock score reflects its strong financial performance and strategic positioning, supported by recent corporate events enhancing liquidity. However, technical analysis indicates bearish momentum, and challenges in certain markets temper the outlook.

Positive Factors

Acquisition Strategy

A successful execution of the Norcal external growth strategy with significant acquisitions and investments was achieved.

Financial Guidance

The company raised its 2025 Core FFOps guidance, indicating improved financial expectations.

Market Demand

Los Angeles and Ventura County same-store revenue improved significantly, likely due to wildfire-related demand.

Negative Factors

Economic Conditions

The economy in Los Angeles is weakening, which negatively impacts the company's performance.

Guidance Expectations

ESS's 2025 guidance was maintained below Street expectations and 2Q25 was initiated below expectations.

Rental Rates

Lower rental rate growth compared to expectations contributed to the guidance miss.

Essex Property Business Overview & Revenue Model

Company Description

Essex Property (ESS) is a real estate investment trust (REIT) that specializes in the acquisition, development, and management of multifamily residential properties. Operating primarily in the West Coast markets of the United States, Essex focuses on urban and suburban areas with high demand for rental housing. The company offers a range of services, including property leasing, asset management, and community development, catering to a diverse demographic of renters seeking quality living environments.

How the Company Makes Money

Essex Property generates revenue primarily through the rental income derived from its multifamily residential properties. The company leases apartment units to tenants, creating a steady stream of cash flow. Additionally, Essex benefits from other revenue streams such as ancillary income, which includes fees from services like parking, laundry facilities, and rental of retail spaces within its properties. The company may also engage in strategic property sales or refinancing activities to realize gains from its real estate investments. Significant partnerships with local developers and community organizations further enhance its ability to identify profitable investment opportunities and manage properties effectively, contributing to its overall earnings.

Essex Property Financial Statement Overview

Summary

Essex Property exhibits solid financial health with strong profitability and efficient cash flow management. Revenue and profit margins are robust, although moderate leverage requires careful management. The company is well-positioned for continued growth in the residential REIT sector.

Income Statement

Essex Property demonstrated strong revenue growth, with an 8.6% increase in total revenue from 2023 to 2024. The gross profit margin for TTM stands at 55.96%, which is healthy for the industry. Despite slight fluctuations, the net profit margin remained robust at 37.08% for TTM, indicating efficient cost management. EBIT and EBITDA margins are also strong at 45.77% and 81.69% respectively, showcasing operational efficiency.

Balance Sheet

The company's balance sheet shows a solid equity position with an equity ratio of 42.23% for TTM. The debt-to-equity ratio is 1.23, reflecting moderate leverage. Return on equity is 12.06% for TTM, indicating effective use of equity to generate profits. However, the reliance on debt needs monitoring to ensure financial stability.

Cash Flow

Essex Property's cash flow statement reveals a positive free cash flow growth rate of -3.04% from 2023 to 2024, indicating stable cash generation. The operating cash flow to net income ratio is a strong 1.55 for TTM, suggesting efficient cash conversion. The free cash flow to net income ratio stands at 1.34, confirming healthy cash reserves relative to profits.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.81B	1.77B	1.67B	1.61B	1.44B	1.50B
Gross Profit	1.01B	1.21B	1.14B	1.10B	959.11M	1.02B
EBITDA	1.48B	1.63B	1.49B	1.13B	1.05B	1.02B
Net Income	671.90M	741.52M	405.82M	408.31M	488.55M	568.87M
Balance Sheet
Total Assets	13.19B	12.93B	12.36B	12.37B	13.00B	12.94B
Cash, Cash Equivalents and Short-Term Investments	174.75M	136.59M	479.54M	155.42M	250.47M	231.81M
Total Debt	6.84B	6.65B	6.27B	6.03B	6.36B	6.33B
Total Liabilities	7.41B	7.18B	6.74B	6.45B	6.79B	6.72B
Stockholders Equity	5.57B	5.54B	5.42B	5.72B	5.99B	6.00B
Cash Flow
Free Cash Flow	903.53M	931.91M	839.69M	812.46M	784.06M	713.02M
Operating Cash Flow	1.04B	1.07B	980.06M	975.65M	905.26M	803.11M
Investing Cash Flow	-850.74M	-973.05M	-145.14M	145.96M	-397.40M	-416.90M
Financing Cash Flow	-590.72M	-419.74M	-477.27M	-1.14B	-533.26M	-383.26M

Essex Property Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 253.99
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ESS, the sentiment is Negative. The current price of 253.99 is below the 20-day moving average (MA) of 272.39, below the 50-day MA of 278.58, and below the 200-day MA of 283.32, indicating a bearish trend. The MACD of -8.36 indicates Positive momentum. The RSI at 32.90 is Neutral, neither overbought nor oversold. The STOCH value of 8.63 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ESS.

Essex Property Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EQR	78 Outperform	$23.95B	23.99	9.20%	4.39%	4.49%	5.87%
AVB	70 Outperform	$26.62B	22.99	9.77%	3.69%	6.44%	37.67%
UDR	70 Neutral	$12.43B	97.81	3.74%	4.52%	2.29%	-4.89%
MAA	69 Neutral	$16.62B	28.52	9.58%	4.35%	1.19%	10.52%
ESS	68 Neutral	$16.93B	20.42	14.40%	3.95%	7.56%	54.15%
INVH	66 Neutral	$18.41B	66.94	5.65%	3.83%	4.41%	-0.16%
Sector *	61 Neutral	kr18.18B	19.98	2.74%	2.57%	2.24%	140.90%

Essex Property Corporate Events

Essex Property Secures New Credit Facilities

On May 20, 2025, Essex Property Trust, Inc., through its Operating Partnership, entered into a Closing Agreement with PNC Bank and other lenders to replace its existing $1.2 billion Revolving Credit Facility with a new facility. The new facility, expected to be effective in July 2025, will have a maximum borrowing capacity of $1.5 billion, with potential to increase to $2.5 billion, and a maturity date in January 2030. Additionally, Essex established a $300 million Unsecured Term Loan Credit Facility with U.S. Bank, maturing in 2028, and initiated a $750 million Commercial Paper Program. These financial maneuvers are aimed at enhancing liquidity and financial flexibility, positioning Essex Property Trust to better manage its operations and growth strategies.

The most recent analyst rating on (ESS) stock is a Sell with a $303.00 price target. To see the full list of analyst forecasts on Essex Property stock, see the ESS Stock Forecast page.

Essex Property Holds Annual Meeting, Elects Directors

On May 13, 2025, Essex Property Trust, Inc. held its Annual Meeting where stockholders elected directors to serve until the 2026 annual meeting, ratified KPMG LLP as the independent registered public accounting firm for 2025, and approved executive officer compensation on a non-binding advisory basis. These decisions are expected to impact the company’s governance and financial oversight, reinforcing its strategic direction and operational stability.

The most recent analyst rating on (ESS) stock is a Sell with a $303.00 price target. To see the full list of analyst forecasts on Essex Property stock, see the ESS Stock Forecast page.