Workspace Group plc R.E.I.T. (WKP) AI Stock Analysis

• Market Cap: £797.15M
• Dividend Yield: 4.53%
• Average Volume (3M): 485.61K
• Price to Earnings (P/E): 147.7
• Beta (1Y): 1.30
• Revenue Growth: 1.86%
• EPS Growth: 84.48%
• Country: UK
• Employees: 329
• Sector: Real Estate
• Sector Strength: 63
• Industry: REIT - Office
• EPS (TTM): -0.03
• Shares Outstanding: 192,143,000
• 10 Day Avg. Volume: 625,854
• 30 Day Avg. Volume: 485,605
• PEG Ratio: -0.49
• Price to Book (P/B): 0.88
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 23.48
• 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: £547.50
• Price Target Upside: 33.05% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4

• Rating: 58 Neutral
• Price Target: ―

Workspace Group plc's overall stock score reflects a challenging financial environment marked by substantial profitability issues and a negative P/E ratio. However, technical indicators show some positive momentum, and strategic corporate events provide optimism for future performance. The high dividend yield offers some investor appeal, though sustainability remains a concern. The balance sheet's moderate leverage is a positive, but the company must improve its earnings to enhance its stock performance.

Positive Factors

Earnings

EPS grew 5% in H1, driven mainly by a 2.8% growth in like-for-like rent per sq ft.

Financial performance

The interim results continue to show robust growth, with capital values appearing to have stabilized and the company being well-capitalized, generating an attractive and growing total return.

Viewings

2025 started well with 337 viewings, including the strongest week for viewings since the COVID pandemic.

Negative Factors

Interest rates

Workspace shares have seen a sharp sell-off, falling 18% since the start of October, as interest rate expectations reversed and the five-year swap has risen 50bps from the September lows.

Macroeconomic environment

The macroeconomic environment continued to weigh on customer activity in the third quarter.

Occupancy

Like-for-like occupancy declined 1.3% to 86.1% as company faced higher churn and customers vacating larger spaces.

Workspace Group plc R.E.I.T. Business Overview & Revenue Model

Company Description

Workspace Group plc R.E.I.T. (WKP) is a real estate investment trust specializing in providing flexible office spaces primarily in London. The company caters to a diverse range of businesses, from startups and small enterprises to larger corporations, offering customizable office solutions and amenities tailored to meet the dynamic needs of modern workspaces. Workspace Group is known for its innovative approach to office leasing, focusing on creating vibrant, community-driven environments that foster business growth and collaboration.

How the Company Makes Money

Workspace Group plc R.E.I.T. generates revenue primarily through leasing office spaces to businesses on flexible terms. The company's key revenue streams include rental income from long-term leases and short-term licenses, as well as service charges for utilities and maintenance. Additionally, Workspace Group may earn money through ancillary services such as meeting room rentals and event spaces. The company's strategic focus on high-demand locations in London and the ability to offer adaptable office solutions contribute significantly to its earnings. By maintaining a strong portfolio of properties and continuously enhancing the value of its assets, Workspace Group ensures stable and recurring income.

Workspace Group plc R.E.I.T. Financial Statement Overview

Summary

Workspace Group plc shows a mixed financial performance with modest revenue growth but significant profitability challenges. The balance sheet reflects moderate leverage, though declining equity ratios pose a risk. Cash flow remains a concern with declining free cash flow, though operating cash flows are positive. The company needs to address profitability issues to improve its financial outlook.

Income Statement

The company's revenue has shown a modest growth of 5.8% in the latest year, indicating some positive momentum. However, the net profit margin is deeply negative, driven by substantial net losses, which overshadow the revenue growth. The negative EBIT margin highlights challenges in operational efficiency.

Balance Sheet

The debt-to-equity ratio is moderate, suggesting a balanced leverage position. However, the equity ratio has decreased, indicating a higher proportion of liabilities relative to assets. The return on equity is negative, reflecting the net losses and impacting shareholder returns.

Cash Flow

Free cash flow has declined, with a growth rate of -30.7%, indicating a potential strain on cash resources. The operating cash flow to net income ratio is favorable due to positive operating cash flows, but the overall financial health is challenged by negative net income.

Breakdown
TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement		Total Revenue
186.00M	184.30M	174.20M	132.90M	142.30M	161.40M
	Gross Profit
125.70M	126.20M	116.60M	86.70M	81.50M	122.00M
	EBIT
-2.70M	-157.90M	95.10M	67.40M	62.50M	104.30M
	EBITDA
101.00M	103.20M	97.40M	70.10M	-209.90M	105.70M
	Net Income Common Stockholders
-34.40M	-192.50M	-37.80M	123.90M	-235.70M	72.10M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
9.00M	11.60M	18.50M	49.00M	191.00M	79.20M
	Total Assets
2.51B	2.53B	2.84B	2.51B	2.59B	2.74B
	Total Debt
890.10M	889.50M	943.60M	626.50M	779.10M	654.40M
	Net Debt
881.10M	877.90M	925.10M	577.50M	588.10M	575.20M
	Total Liabilities
982.30M	982.50M	1.05B	712.30M	874.10M	737.50M
	Stockholders Equity
1.52B	1.55B	1.79B	1.80B	1.72B	2.00B
Cash Flow		Free Cash Flow
74.00M	51.90M	74.90M	56.70M	36.00M	81.50M
	Operating Cash Flow
74.50M	53.90M	78.80M	57.90M	38.40M	84.70M
	Investing Cash Flow
-8.40M	45.90M	-200.20M	9.20M	-14.90M	14.60M
	Financing Cash Flow
-67.40M	-106.70M	90.90M	-209.10M	90.30M	-46.80M

Workspace Group plc R.E.I.T. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 411.50
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:WKP, the sentiment is Negative. The current price of 411.5 is below the 20-day moving average (MA) of 414.00, below the 50-day MA of 422.75, and below the 200-day MA of 495.03, indicating a bearish trend. The MACD of -5.93 indicates Negative momentum. The RSI at 43.78 is Neutral, neither overbought nor oversold. The STOCH value of 59.89 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:WKP.

Workspace Group plc R.E.I.T. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BYG	81 Outperform	$1.98B	9.82	8.06%	4.46%	4.34%	33.66%
DLN	76 Outperform	£2.23B	19.23	3.29%	5.59%	3.70%	―
SGRO	74 Outperform	£9.54B	15.77	5.18%	5.73%	-9.88%	―
BLND	68 Neutral	£3.93B	11.18	6.14%	6.23%	-30.83%	―
Sector *	61 Neutral	$2.86B	10.96	0.41%	6.08%	5.73%	-21.25%
WKP	58 Neutral	£797.15M	147.69	0.35%	4.53%	1.86%	84.48%
LAND	47 Neutral	£4.71B	11.90	6.13%	5.99%	-1.73%	―

Workspace Group plc R.E.I.T. Corporate Events

Workspace Group Reports Strong Q4 Lettings Amid Economic Challenges

Workspace Group PLC reported a strong performance in the fourth quarter ending March 31, 2025, with significant growth in lettings and rent roll, despite macroeconomic challenges. The company completed 390 new lettings with a total rental value of £10.1 million, and like-for-like rent per square foot increased by 0.9%. However, occupancy declined by 1% to 85.1% due to larger unit vacancies and refurbishments. Workspace continues to focus on capital recycling, having disposed of non-core assets worth £52.5 million, and maintains a robust balance sheet with £260 million in cash and undrawn facilities. Looking forward, the company is set to publish its full-year results and strategy update in June 2025, aiming to capitalize on structural growth opportunities in the SME market.

Spark’s Take on GB:WKP Stock

According to Spark, TipRanks’ AI Analyst, GB:WKP is a Neutral.

Workspace Group plc faces significant challenges in profitability, reflected in its financial performance and negative P/E ratio. However, strategic corporate events and a high dividend yield provide some optimism. The stock’s bearish technical indicators suggest caution, but positive corporate developments could improve future prospects.

To see Spark’s full report on GB:WKP stock, click here.

Workspace Group PLC: BlackRock Adjusts Major Shareholding

Workspace Group PLC announced a change in major shareholdings, with BlackRock, Inc. adjusting its voting rights in the company. The transaction, which involved both the acquisition and disposal of voting rights and financial instruments, resulted in BlackRock holding 9.14% of the total voting rights in Workspace Group, down from a previous position of 9.61%. This adjustment in holdings could influence the company’s strategic decisions and stakeholder dynamics, given BlackRock’s significant influence as a major shareholder.

Workspace Group Appoints New Head of Portfolio Management

Workspace Group PLC has announced the appointment of Jessica Berney as the new Head of Portfolio Management, effective from July 1, 2025. With extensive experience in the real estate sector, Berney is expected to play a crucial role in optimizing Workspace’s portfolio and enhancing its capital allocation strategies to better serve London’s SMEs. This strategic move is aimed at positioning Workspace to capitalize on long-term growth opportunities in the flexible office space market.

Workspace Group Announces Change in BlackRock’s Voting Rights

Workspace Group PLC has announced a change in the voting rights held by BlackRock, Inc., a major stakeholder. The notification indicates that BlackRock’s total voting rights in Workspace Group have decreased from 9.91% to 9.61%, reflecting a slight reduction in their stake. This adjustment in holdings could influence the company’s governance and decision-making processes, impacting its strategic direction and potentially affecting shareholder interests.

BlackRock Adjusts Stake in Workspace Group, Reducing Voting Rights

Workspace Group plc has announced a change in the voting rights held by BlackRock, Inc., a major shareholder. As of March 20, 2025, BlackRock’s total voting rights in Workspace Group have decreased from 10.96% to 9.91%, following a disposal of shares and financial instruments. This adjustment in holdings reflects BlackRock’s strategic portfolio management and may influence the company’s governance dynamics, impacting stakeholders and potentially altering market perceptions.

Workspace Group Sees Change in Major Holdings by BlackRock

Workspace Group plc has announced a change in major holdings, with BlackRock, Inc. adjusting its voting rights in the company. As of February 25, 2025, BlackRock holds 10.96% of the voting rights in Workspace Group, a slight decrease from the previous 11.84%. This adjustment in holdings could impact the company’s strategic decisions and influence its market positioning, as BlackRock is a significant stakeholder with substantial voting power.