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Gladstone Commercial Corp (GOOD)
NASDAQ:GOOD
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Gladstone Commercial
(NASDAQ:GOOD)
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Rating:55Neutral
Price Target:
$11.50
▼(-7.85% Downside)
Action:ReiteratedDate:02/19/26
Overall score reflects a stable-but-levered financial profile (high debt remains the main risk despite improvement), a largely neutral technical setup, and a mixed valuation (very high yield but elevated P/E). Earnings call commentary is moderately supportive due to strong occupancy, rent collection, and industrial repositioning, tempered by slight FFO per-share decline and near-term execution/rollover risks.
Positive Factors
High occupancy & rent collection
Near-complete occupancy and full cash rent collection indicate stable, predictable rental cash flows that underpin dividend support and reduce short-term volatility. Over the next 2–6 months this durability strengthens underwriting for new acquisitions and lowers tenant default risk across the net‑lease portfolio.
Industrial repositioning and acquisitions
A meaningful shift toward industrial assets and $206M of targeted acquisitions improves portfolio exposure to higher-demand, logistics-oriented real estate. Longer average lease terms on recent deals (weighted avg 15.9 years) boost cash‑flow resilience and reduce vacancy and rollover risk over the medium term.
Expanded financing capacity
Improved access to capital via an upsized $600M facility, a five‑year private placement and ATM proceeds increases flexibility to fund accretive industrial buys and refinance maturities. This structural enhancement lowers execution risk on strategic growth plans despite an active, competitive acquisition market.
Negative Factors
Elevated leverage
Leverage remains a structural constraint for this rate-sensitive REIT: although improving, a ~2.44x debt/equity ratio limits financial flexibility and increases refinancing and interest‑rate risk. Elevated leverage can magnify cash‑flow variability and constrain opportunistic investment or dividend coverage under stress.
Limited immediate liquidity
Very low on‑hand cash and upcoming loan maturities create durable refinancing dependence on credit markets and capital‑markets actions. This raises execution risk for acquisitions, dispositions, and near‑term liabilities; repeated reliance on external funding can increase financing costs and strategic constraints.
Office disposition and rollover risk
Uncertain timing and execution for offloading office assets leaves potential long‑term drag on portfolio performance and cash generation. Coupled with concentrated near‑term lease expirations (~8% of rent in 2026), this elevates rollover and leasing risk, making operational results sensitive to market and execution outcomes.
Gladstone Commercial (GOOD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$609.39M
Dividend Yield11.56%
Average Volume (3M)493.80K
Price to Earnings (P/E)89.0
Beta (1Y)0.61
Revenue Growth4.95%
EPS Growth-6.49%
CountryUS
Employees69
SectorReal Estate
Sector Strength53
IndustryREIT - Diversified
Share Statistics
EPS (TTM)0.05
Shares Outstanding48,406,994
10 Day Avg. Volume561,647
30 Day Avg. Volume493,798
Financial Highlights & Ratios
PEG Ratio0.45
Price to Book (P/B)1.47
Price to Sales (P/S)3.12
P/FCF Ratio5.72
Enterprise Value/Market Cap2.38
Enterprise Value/Revenue8.99
Enterprise Value/Gross Profit151.33
Enterprise Value/Ebitda24.89
Forecast
1Y Price Target
$12.75Price Target Upside2.16% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)0.18
Revenue Forecast (FY)$174.68M
Gladstone Commercial Business Overview & Revenue Model
Company DescriptionGladstone Commercial Corporation is a real estate investment trust focused on acquiring, owning, and operating net leased industrial and office properties across the United States. Including payments through September 2020, Gladstone Commercial has paid 189 consecutive monthly cash distributions on its common stock. Prior to paying distributions on a monthly basis, Gladstone Commercial paid five consecutive quarterly cash distributions. The company has also paid 53 consecutive monthly cash distributions on its Series D Preferred Stock, 12 consecutive monthly cash distributions on its Series E Preferred Stock and three consecutive monthly cash distributions on its Series F Preferred Stock. Gladstone Commercial has never skipped, reduced or deferred a distribution since its inception in 2003.
How the Company Makes MoneyGladstone Commercial generates revenue primarily through leasing its properties to tenants under long-term net lease agreements. These leases typically require tenants to cover property expenses such as maintenance, insurance, and property taxes, allowing Gladstone to maintain a more predictable and stable cash flow. The company earns rental income from its diverse portfolio, which includes industrial facilities and office spaces, thereby providing a steady stream of revenue. Additionally, Gladstone may benefit from property appreciation over time and potential sale of properties, providing further financial gains. The company's strategy is also bolstered by its focus on high-quality tenants with strong credit ratings, minimizing the risk of tenant defaults and enhancing overall profitability.
Gladstone Commercial Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks down where the company earns money—rental income, management fees, asset sales, and other services—highlighting which activities drive recurring cash flow versus one-time gains. Segment trends reveal what supports the dividend, which parts are most sensitive to market or tenant weakness, and where management is focusing growth efforts.
Breaks down where the company earns money—rental income, management fees, asset sales, and other services—highlighting which activities drive recurring cash flow versus one-time gains. Segment trends reveal what supports the dividend, which parts are most sensitive to market or tenant weakness, and where management is focusing growth efforts.
Data provided by:
The Fly
The FlyGladstone Commercial Earnings Call Summary
Earnings Call Date:Feb 18, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 11, 2026
Earnings Call Sentiment Positive
The call emphasized meaningful progress on strategic priorities — notably large industrial acquisitions (~$206M), a continued shift to industrial concentration (69% of annualized straight-line rent), very high occupancy (99.1%) and strong rent collection, combined with expanded financing capacity (upsized $600M credit facility, $85M private placement, $61M ATM). Offsetting these positives were a modest year-over-year decline in full-year FFO/core FFO, higher operating expenses (driven by depreciation and comparability items), limited cash on hand, a competitive acquisition market with some deal slippage, and uncertainty around office dispositions and certain near-term lease maturities. Overall, the operational and balance-sheet moves point to a company executing its industrial-focused strategy successfully, while managing typical sector and market headwinds.Q4-2025 Updates
Positive Updates
Significant Industrial Acquisitions
Acquired over $206 million of industrial assets across 10 facilities totaling 1.6 million sq ft in 2025, with a weighted average cap rate of 8.88% and weighted average lease term at closing of 15.9 years.
Increased Industrial Concentration
Industrial concentration rose to 69% of annualized straight-line rent as of December 31, 2025, up from 63% a year earlier (increase of 6 percentage points), reflecting successful portfolio repositioning toward industrial assets.
High Occupancy and Rent Collections
Portfolio occupancy at 99.1% and 100% collection of cash-based rents for the period, indicating strong tenant demand and effective property management.
Same-Store Lease Revenue Growth
Same-store lease revenue increased 4% for the 12 months ended December 31, 2025 versus 2024, driven by higher recovery revenues and increased rental rates from leasing activity.
Q4 Per-Share Operating Improvement
FFO and core FFO per share for Q4 2025 were $0.37 each versus $0.35 in Q4 2024 — an increase of approximately 5.7% quarter-over-quarter.
Portfolio Enhancements and Leasing Activity
Invested $21 million to renew/extend 1.2 million sq ft across 18 properties, resulting in a $2.1 million net increase in GAAP rent and increasing portfolio WALT (average remaining lease term reported at 7.3 years).
Strengthened Liquidity & Capital Markets Access
Amended and upsized syndicated bank credit facility from $505 million to $600 million; issued $85 million of 5.99% senior unsecured notes (private placement); sold 4.4 million shares under ATM raising $61 million — actions that expanded financing capacity.
Balance Sheet and Net Asset Growth
Net assets increased from $1.1 billion to $1.25 billion during 2025 (increase of ~$150 million, or about +13.6%), reflecting net portfolio acquisitions and revenue-generating portfolio CapEx.
Revenue Increase in Q4
Total operating revenues for Q4 2025 were $43.5 million versus $37.4 million in Q4 2024 — an increase of $6.1 million (+16.3%), attributed to a larger portfolio, increased recovery revenues, and higher rental rates.
Active Pipeline and Acquisition Targets
Management reported an active transaction pipeline in the neighborhood of $300 million of opportunities and is targeting assets with cap rates generally between ~7.5%–8.5% (with competition), intending to be selective and focused on underwriting and tenant quality.
Negative Updates
Full-Year FFO Decline
FFO and core FFO per share for the 12 months ended December 31, 2025 were $1.38 and $1.40, respectively, versus $1.41 and $1.42 in 2024 — declines of ~2.1% (FFO) and ~1.4% (core FFO) year-over-year.
Rising Operating Expenses and Comparability Items
Operating expenses increased in Q4 2025 to $26.4 million from $25.0 million in Q4 2024 (+5.6%), driven primarily by higher depreciation from a larger portfolio; comparability was affected by a prior-period impairment charge and incentive fee credit in Q4 2024.
Limited Immediate Cash on Hand
Cash on hand was approximately $4 million at quarter end with $60 million of availability on the credit facility; while financing options exist, near-term cash is limited and the company has $27.6 million of loan maturities in 2026.
Competitive Acquisition Market and Some Deal Slippage
Management noted a very competitive middle-market triple-net environment with cap-rate pressure (floor ~7.5%); some previously pursued transactions did not close (seller pulled back) and pace of deals picked up only late in 2025, suggesting deal execution risk and pricing constraints.
Office Portfolio & Disposition Uncertainty
Company acknowledged a challenging office environment and has no definitive timeline to dispose of all office properties, indicating execution risk and potential drag from non-core assets.
Concentration of Near-Term Lease Maturities
Eight leases maturing in 2026 represent ~8% of straight-line rent (including a GM-occupied Austin asset representing ~3% maturing year-end); while management is confident on most renewals, several upcoming expirations require active leasing and present execution risk.
Company Guidance
The company’s guidance centers on continuing to grow industrial concentration and deploying capital into accretive industrial acquisitions while extending leases and disposing of noncore assets, with a near‑term target of ~70% industrial annualized straight‑line rent (already 69% at year‑end, up from 63% in 2024). Key 2025 metrics supporting that plan include $206M of industrial acquisitions across 10 facilities totaling 1.6M sq ft (weighted avg cap rate 8.88% and avg lease term at closing 15.9 years), $21M of portfolio CapEx to renew/extend 1.2M sq ft at 18 properties producing a $2.1M net GAAP rent increase, 99.1% occupancy, 100% cash rent collection, avg remaining lease term 7.3 years, and same‑store lease revenue +4% YoY. Financially, Q4 operating revenues were $43.5M with $26.4M of operating expenses; FFO/core FFO per share were $0.37 for Q4 (vs $0.35 prior year) and $1.38/$1.40 for the full year (vs $1.41/$1.42), net assets rose from $1.1B to $1.25B, and the dividend remains $0.30 per quarter ($1.20/year). Liquidity and capital structure actions include an amended $600M credit facility (term loans + $200M revolver), $37.4M revolver borrowings outstanding, ~$60M availability and $4M cash on hand, ~$27.6M in 2026 loan maturities, a debt mix of 48% fixed/47% hedged floating/5% floating with effective avg SOFR 3.87%, an $85M private placement at 5.99% due in 2030, 4.4M ATM shares sold for $61M, and an active ~$300M pipeline pursuing acquisitions at a competitive cap‑rate floor around 7.5%–8.5% (with some assets averaging north of 9%).Gladstone Commercial Financial Statement Overview
Summary
Operations and cash generation are generally supportive (higher 2025 operating cash flow and solid FCF vs. net income), but the balance sheet remains a key constraint: leverage is still high despite improvement (debt-to-equity ~2.44x in 2025 after much higher levels), and profitability has been inconsistent (notably weaker 2023 margins).Income Statement
Revenue has been relatively steady with modest growth (2025 annual revenue up ~3.9% after a flat 2024 and slight decline in 2023). Profitability is positive but uneven: net margin improved to ~12.0% in 2025 after ~16.1% in 2024, while 2023 was notably weak (~3.4% net margin). EBITDA margin remains solid in the annual data, but the inconsistency in margins and earnings quality year-to-year keeps the score in the mid range.62
Positive
Balance Sheet
Leverage remains a key overhang. Debt-to-equity is elevated across the period and, while improving in 2025 (about 2.44x vs ~4.07x in 2024 and ~4.85x in 2023), it still implies meaningful balance-sheet risk for a rate-sensitive REIT. Return on equity is acceptable in 2024–2025 (~11–14%) but was much lower in 2023, highlighting sensitivity to operating conditions. Overall: improving trajectory, but leverage is still high.44
Neutral
Cash Flow
Cash generation is generally supportive: operating cash flow rose to ~$88.2M in 2025 (strong growth vs 2024) and free cash flow matches operating cash flow in 2024–2025, indicating limited drag from investment spending in the provided data. Free cash flow is strong relative to net income (about 1.0x in 2024–2025 and ~0.89–0.92x in 2021–2023). The main watch item is variability in cash flow coverage of debt, which swings materially across years (notably low in 2025), suggesting sensitivity to financing and repayment dynamics.58
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 161.34M | 149.39M | 147.58M | 148.98M | 137.69M |
| Gross Profit | 9.58M | 117.86M | 115.35M | 115.82M | 104.71M |
| EBITDA | 119.44M | 117.23M | 100.14M | 103.42M | 96.97M |
| Net Income | 19.29M | 24.00M | 4.99M | 10.80M | 10.94M |
Balance Sheet | |||||
| Total Assets | 1.25B | 1.09B | 1.13B | 1.20B | 1.14B |
| Cash, Cash Equivalents and Short-Term Investments | 10.81M | 10.96M | 11.98M | 11.65M | 7.96M |
| Total Debt | 856.39M | 697.45M | 743.95M | 754.51M | 713.03M |
| Total Liabilities | 905.00M | 923.05M | 979.21M | 996.94M | 940.79M |
| Stockholders Equity | 341.81M | 171.17M | 153.28M | 203.90M | 201.30M |
Cash Flow | |||||
| Free Cash Flow | 88.15M | 56.95M | 53.69M | 62.35M | 64.78M |
| Operating Cash Flow | 88.15M | 56.95M | 60.37M | 69.18M | 70.13M |
| Investing Cash Flow | -221.38M | -1.73M | 1.24M | -82.03M | -94.78M |
| Financing Cash Flow | 134.74M | -56.29M | -61.47M | 15.66M | 21.75M |
Gladstone Commercial Technical Analysis
Positive
12.48
Price Trends
11.20
Positive
11.00
Positive
11.91
Positive
Market Momentum
0.34
Negative
69.36
Neutral
74.71
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GOOD, the sentiment is Positive. The current price of 12.48 is above the 20-day moving average (MA) of 11.72, above the 50-day MA of 11.20, and above the 200-day MA of 11.91, indicating a bullish trend. The MACD of 0.34 indicates Negative momentum. The RSI at 69.36 is Neutral, neither overbought nor oversold. The STOCH value of 74.71 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GOOD.
Gladstone Commercial Risk Analysis
Gladstone Commercial disclosed 52 risk factors in its most recent earnings report. Gladstone Commercial reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Gladstone Commercial Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $504.33M | 15.11 | 10.91% | 9.03% | 7.71% | -5.37% | |
69 Neutral | $632.96M | 243.30 | 1.71% | 8.56% | 23.84% | -312.04% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
61 Neutral | $476.11M | -76.87 | ― | 9.50% | -39.94% | ― | |
55 Neutral | $609.39M | 88.98 | 5.53% | 11.56% | 4.95% | -6.49% | |
54 Neutral | $775.58M | -2.25 | -30.58% | 5.44% | -16.50% | -640.43% | |
53 Neutral | $728.03M | -21.91 | -3.14% | 10.83% | -12.57% | 70.50% |
* Real Estate Sector Average
GOOD
Gladstone Commercial
12.48
-2.13
-14.56%
CTO
CTO Realty Growth
19.53
2.35
13.68%
OLP
One Liberty Properties
23.48
-0.80
-3.31%
AHH
Armada Hoffler Properties
5.95
-2.68
-31.01%
BRSP
BrightSpire Capital
5.72
0.05
0.83%
PKST
Peakstone Realty Trust
20.84
10.37
99.04%
Gladstone Commercial Corporate Events
Business Operations and StrategyPrivate Placements and Financing
Gladstone Commercial Secures $85M in Private Placement
Positive
Dec 15, 2025
On December 15, 2025, Gladstone Commercial Corporation and its majority-owned operating partnership entered into a Note Purchase Agreement with institutional investors for a private placement of $85 million in senior guaranteed notes. These notes, which mature on December 15, 2030, bear a fixed annual interest rate of 5.99% and are intended to repay borrowings under the partnership’s revolving line of credit, repay term loan debt, and support general corporate purposes. This strategic financial move is expected to enhance the company’s operational flexibility and financial stability.
The most recent analyst rating on (GOOD) stock is a Hold with a $11.50 price target. To see the full list of analyst forecasts on Gladstone Commercial stock, see the GOOD Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.