Grit Real Estate Income Group Limited (GR1T) AI Stock Analysis

• Market Cap: £33.21M
• Dividend Yield: N/A
• Average Volume (3M): 81.83K
• Price to Earnings (P/E): ―
• Beta (1Y): -0.19
• Revenue Growth: 15.55%
• EPS Growth: -116.52%
• Country: UK
• Employees: 140
• Sector: Real Estate
• Sector Strength: 53
• Industry: Real Estate - Services
• EPS (TTM): -0.06
• Shares Outstanding: 519,587,800
• 10 Day Avg. Volume: 5,045
• 30 Day Avg. Volume: 81,827
• PEG Ratio: >-0.01
• Price to Book (P/B): 0.43
• Price to Sales (P/S): 1.72
• P/FCF Ratio: 5.54
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 52 Neutral
• Price Target: 7.00p ▲(6.87% Upside)

Grit Real Estate faces significant financial challenges with high leverage and negative net income, which weigh heavily on its stock score. The technical analysis suggests a bearish trend. However, the company's strategic initiatives, including expansion and cost-saving partnerships, provide a positive outlook for future stability and growth. A high dividend yield offers some appeal despite a negative P/E ratio.

Positive Factors

Revenue Growth

The company's consistent revenue growth indicates a strong market position and effective property management, contributing to long-term business sustainability.

Strategic Expansion

This strategic expansion into embassy accommodations enhances GR1T's asset portfolio and positions it for growth in a niche market, potentially increasing future revenue streams.

Cost Reduction Initiatives

The partnership is expected to save US$1 million annually, improving operational efficiencies and supporting financial stability through cost management.

Negative Factors

High Leverage

High leverage poses financial risks, potentially limiting the company's ability to invest in growth opportunities and increasing vulnerability to economic downturns.

Negative Net Income

Persistent negative net income undermines profitability, affecting shareholder returns and the company's ability to reinvest in its operations for future growth.

Inconsistent Free Cash Flow

Inconsistent free cash flow growth can hinder the company's ability to fund new projects, pay down debt, or return capital to shareholders, impacting long-term financial health.

Grit Real Estate Income Group Limited Business Overview & Revenue Model

Company Description

Grit is listed on the London Stock Exchange main market (LSE: GR1T), the Johannesburg Stock Exchange main board (JSE: GTR) and the Stock Exchange of Mauritius Ltd official market (SEM: DEL.N0000). Grit Real Estate Income Group Limited is a leading pan-African real estate company focused on investing in and actively managing a diversified portfolio of assets in carefully selected African countries (excluding South Africa). By investing in real estate assets across Africa, the Company is building a secure financial future for schools, employees, non-profit organisations, and the like. As such, Grit is unlocking potential across the African continent in an effort to anchor communities and create sustainable jobs. The company's high-quality assets are underpinned by predominantly US$ and Euro denominated long-term leases with a wide range of blue-chip multi-national tenant covenants across a diverse range of robust property sectors. The Company is committed to delivering strong and sustainable income for shareholders, with the potential for income and capital growth. The Company is targeting 8.5%+ p.a. dividend yield in USD and 12.0%+ p.a. NAV total return.

How the Company Makes Money

Grit Real Estate Income Group Limited makes money by acquiring, managing, and leasing out commercial real estate properties across various African countries. The company's revenue model is primarily based on rental income generated from its portfolio of properties, which includes retail centers, office buildings, hotels, and industrial facilities. Additionally, GR1T may engage in property development or redevelopment projects to enhance the value of its assets. The company also focuses on optimizing occupancy rates and rental agreements to maximize income. Strategic partnerships with local developers and financial institutions across its operating regions play a crucial role in securing quality assets and funding growth, thus contributing significantly to its earnings.

Grit Real Estate Income Group Limited Financial Statement Overview

Summary

Grit Real Estate Income Group Limited shows revenue growth but faces challenges in profitability with negative net income and high leverage. Positive operating cash flow indicates cash generation ability, though significant debt and negative shareholder returns require attention.

Income Statement

The company has shown revenue growth over the TTM, but this is overshadowed by significant negative net income, leading to a negative net profit margin. EBIT margins are relatively healthy, indicating operational efficiency, but the absence of EBITDA due to a lack of depreciation and amortization expenses affects comprehensive profitability analysis.

Balance Sheet

The debt-to-equity ratio is concerning, as the company is heavily leveraged, which poses financial risk. However, the equity ratio is moderate, suggesting some stability in asset financing. Return on equity is negative due to sustained net losses, indicating poor returns for shareholders.

Cash Flow

Operating cash flow is positive and has shown growth, which is a positive sign of the company's ability to generate cash. However, free cash flow growth is inconsistent, and the ratios of operating and free cash flow to net income are skewed due to negative net income figures.

Breakdown	TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement
Total Revenue	76.90M	63.98M	56.25M	72.55M	49.22M	48.53M
Gross Profit	76.90M	51.61M	46.63M	43.28M	40.67M	39.55M
EBITDA	0.00	-38.62M	18.27M	40.97M	-38.55M	-30.46M
Net Income	-90.83M	-84.50M	-23.63M	10.44M	-51.93M	-63.12M
Balance Sheet
Total Assets	1.02B	1.05B	907.69M	937.22M	810.71M	845.70M
Cash, Cash Equivalents and Short-Term Investments	16.14M	18.77M	9.21M	26.00M	4.89M	3.58M
Total Debt	398.49M	540.85M	459.50M	470.76M	437.87M	448.56M
Total Liabilities	687.63M	697.08M	574.07M	567.84M	532.30M	548.43M
Stockholders Equity	222.20M	254.71M	359.07M	391.60M	296.34M	297.88M
Cash Flow
Free Cash Flow	52.43M	19.89M	32.26M	11.18M	19.70M	10.93M
Operating Cash Flow	52.43M	20.38M	32.55M	11.29M	19.89M	11.66M
Investing Cash Flow	-7.09M	-7.31M	26.91M	-52.85M	-1.53M	-5.45M
Financing Cash Flow	-35.00M	-3.48M	-75.05M	67.39M	-9.92M	-17.95M

Grit Real Estate Income Group Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 6.55
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:GR1T, the sentiment is Positive. The current price of 6.55 is above the 20-day moving average (MA) of 6.37, above the 50-day MA of 6.04, and below the 200-day MA of 6.56, indicating a neutral trend. The MACD of 0.15 indicates Negative momentum. The RSI at 98.92 is Negative, neither overbought nor oversold. The STOCH value of 50.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:GR1T.

Grit Real Estate Income Group Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SRE	77 Outperform	£1.51B	8.55	12.51%	5.71%	4.80%	37.75%
PNS	76 Outperform	£49.46M	6.90	6.15%	3.92%	-6.10%	889.93%
GRI	67 Neutral	£1.44B	7.09	10.30%	3.62%	-8.66%	553.35%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
HLCL	55 Neutral	£235.89M	9.40	6.07%	2.71%	-14.09%	―
GR1T	52 Neutral	£33.21M	-0.38	-43.94%	―	15.55%	-116.52%
PSDL	51 Neutral	£157.94M	―	―	―	―	―

Grit Real Estate Income Group Limited Corporate Events

Grit Real Estate Tightens Control of Kenyan Logistics Asset in Portfolio Optimisation Drive

Grit Real Estate Income Group has moved to streamline and optimise its portfolio by agreeing to acquire the remaining 30% equity stake in Orbit Africa Logistics in Nairobi for a nominal US$2, giving it full ownership and control of the industrial warehousing and manufacturing facility on Mombasa Road. The deal follows the decision by Botswana-listed co-investor Letlole la Rona to exit after weaker performance linked to challenging conditions at main tenant Orbit Products Africa, and will allow Grit to consolidate asset management, complete an operational turnaround through tenant diversification and lease restructuring, and better manage refinancing and capital allocation. The acquisition is expected to be immediately accretive to net asset value by around 2 cents per share, introduces no new group-level liabilities, and is presented as a value-protective step within Grit’s broader non-core disposals and portfolio optimisation strategy, aimed at stabilising income, improving asset valuations and unlocking recovery value for shareholders.

The most recent analyst rating on (GB:GR1T) stock is a Hold with a £7.00 price target. To see the full list of analyst forecasts on Grit Real Estate Income Group Limited stock, see the GB:GR1T Stock Forecast page.

Grit Real Estate Announces AGM and Strategic Board Changes Amid Asset Disposals

Grit Real Estate Income Group Limited has announced its upcoming Annual General Meeting (AGM) and significant board changes, including the transition of the Chairman role from Peter Todd to Nigel Nunoo, ensuring leadership continuity during a pivotal period. The company is focused on debt reduction and strengthening its balance sheet by identifying non-core assets for disposal, with several transactions in progress, including the sale of its shareholding in the Club Med Cap Skirring resort and VDE Housing Estate. These efforts aim to streamline operations and enhance strategic optionality, supported by ongoing engagement with funding partners and interest-rate hedging aligned with market dynamics.

The most recent analyst rating on (GB:GR1T) stock is a Hold with a £7.00 price target. To see the full list of analyst forecasts on Grit Real Estate Income Group Limited stock, see the GB:GR1T Stock Forecast page.