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Gladstone Commercial Corp (GOOD)
NASDAQ:GOOD
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Gladstone Commercial
(NASDAQ:GOOD)
Rating:66Neutral
Price Target:
$15.50
▲(6.02%Upside)
Positive Factors
Capital Management
The company has been active in their capital recycling program, by selling non-core office assets and using it to build on its industrial portfolio, now representing 65% of annualized straight line earnings.
Rent Collection
The company successfully collected 100% of cash rents for the first quarter of 2025, with occupancy standing at 98.4%.
Negative Factors
Debt Levels
The company does have a slightly higher than average level of debt and preferred totaling approximately 53% to total capitalization.
Gladstone Commercial (GOOD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$681.20M
Dividend Yield8.21%
Average Volume (3M)373.42K
Price to Earnings (P/E)50.6
Beta (1Y)0.63
Revenue Growth3.01%
EPS GrowthN/A
CountryUS
Employees69
SectorReal Estate
Sector Strength55
IndustryREIT - Diversified
Share Statistics
EPS (TTM)0.04
Shares Outstanding46,282,864
10 Day Avg. Volume540,500
30 Day Avg. Volume373,423
Financial Highlights & Ratios
PEG Ratio2.84
Price to Book (P/B)3.50
Price to Sales (P/S)0.00
P/FCF Ratio11.16
Enterprise Value/Market Cap2.06
Enterprise Value/Revenue2.36
Enterprise Value/Gross Profit11.83
Enterprise Value/Ebitda3.07
Forecast
1Y Price Target
$16.00Price Target Upside9.44% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
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 makes money through rental income generated from its portfolio of net leased properties. The company enters into long-term lease agreements with tenants, ensuring a consistent revenue stream. Rent payments are typically structured to include fixed base amounts, and some leases may contain escalation clauses that increase rent over time, providing additional revenue growth. Additionally, Gladstone Commercial strategically acquires properties that have the potential for appreciation in value, which can contribute to its earnings through property sales or refinancing. The company's focus on maintaining a diversified tenant base across various sectors helps mitigate sector-specific risks and enhances revenue stability.
Gladstone Commercial Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q1-2025)
| % Change Since: 7.18%|
Next Earnings Date:Aug 12, 2025
Earnings Call Sentiment Positive
The earnings call presented a generally positive outlook with strong performance in industrial property acquisitions and portfolio management. However, challenges such as economic uncertainty and increased operating expenses were noted. The company's strategic focus on industrial properties is a key strength, while the office sector remains a challenge.Q1-2025 Updates
Positive Updates
Strong Portfolio Performance
Gladstone Commercial Corporation maintained a portfolio occupancy rate of 98.4% as of March 31, 2025, with 100% collection of cash-based rents.
Increased Industrial Focus
The company increased its industrial concentration to 65% of annualized straight-line rent with $73.25 million in new industrial property acquisitions.
Positive Financial Metrics
Same-store rents increased by 6.6% year-over-year, with total operating revenues rising from $35.7 million in Q1 2024 to $37.5 million in Q1 2025.
Successful Capital Management
Net assets increased from $1.09 billion to $1.16 billion due to acquisitions, with a manageable debt profile and $99 million in liquidity available.
Negative Updates
Economic Uncertainty and Tariff Impact
The broader economic environment showed growing uncertainty due to recent tariff announcements, affecting companies with exposure to Asia.
Increased Operating Expenses
Operating expenses rose to $23.9 million in Q1 2025 from $23.3 million in Q1 2024 due to inflationary pressures and higher incentive fees.
Challenges in Office Property Sector
The company seeks to reduce its office property holdings, aiming to redeploy capital into industrial assets, highlighting issues in the office sector.
Company Guidance
During the first quarter of 2025 earnings call, Gladstone Commercial Corporation provided guidance emphasizing key metrics and operational strategies. The company reported 100% collection of cash-based rents from their industrial properties, which encompass 355,778 square feet valued at $73.25 million. They increased their industrial concentration to 65% of annualized straight-line rent and maintained a high portfolio occupancy rate at 98.4% as of March 31. They completed acquisitions worth over $73 million and disposed of properties, achieving gains of $377,000 and $3.9 million from sales. Financially, their FFO and Core FFO per share were $0.34, consistent with the previous year, while total operating revenues increased to $37.5 million. The company also highlighted a disciplined approach to acquisitions, with a focus on high-quality, mission-critical industrial assets and maintaining a strong balance sheet with $99 million available in credit and cash. Looking forward, they plan to continue acquiring industrial assets, extending leases, and improving their portfolio while managing leverage and exploring new financing opportunities.Gladstone Commercial Financial Statement Overview
Summary
Gladstone Commercial demonstrates solid financial health with consistent revenue and profit growth. Operational efficiency and cash flow generation are strong. However, high leverage could pose a risk in volatile markets.Income Statement
Gladstone Commercial shows a solid upward trajectory in revenue with a TTM increase to $151.17M from $149.39M the previous year. Gross Profit Margin remains robust at 78.4%, while Net Profit Margin improved significantly, reflecting a positive shift to 16.9% from the prior year's 16.1%. The EBIT and EBITDA margins are stable at 34.8% and 78.3% respectively, indicating strong operational efficiency and cash flow generation.78
Positive
Balance Sheet
The balance sheet shows moderate leverage with a Debt-to-Equity ratio of 4.08, reflecting substantial reliance on debt financing. However, Return on Equity increased to 14.0%, suggesting improved profitability. The Equity Ratio stands at 15.8%, indicating a relatively small equity base compared to total assets, which poses a risk if market conditions worsen.60
Neutral
Cash Flow
Operating Cash Flow to Net Income Ratio is favorable at 2.33, indicating strong cash earnings. Free Cash Flow showed a steady increase, with no capital expenditures reported, but Free Cash Flow to Net Income Ratio is high at 2.33, suggesting robust cash flow compared to net income. However, fluctuations in investing cash flows suggest some volatility in capital allocation.72
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 151.17M | 149.39M | 147.58M | 148.98M | 137.69M | 133.15M |
| Gross Profit | 118.59M | 117.86M | 115.35M | 122.15M | 110.59M | 101.50M |
| EBITDA | 118.40M | 117.23M | 100.14M | 103.42M | 96.97M | 97.26M |
| Net Income | 25.61M | 24.00M | 4.99M | -3.04M | -4.59M | 14.94M |
Balance Sheet | ||||||
| Total Assets | 1.16B | 1.09B | 1.13B | 1.20B | 1.14B | 1.10B |
| Cash, Cash Equivalents and Short-Term Investments | 10.38M | 10.96M | 11.98M | 11.65M | 7.96M | 11.02M |
| Total Debt | 747.69M | 697.45M | 743.95M | 754.51M | 713.03M | 674.38M |
| Total Liabilities | 977.09M | 923.05M | 809.16M | 996.94M | 940.79M | 881.87M |
| Stockholders Equity | 183.22M | 171.17M | 170.04M | 202.78M | 201.30M | 213.18M |
Cash Flow | ||||||
| Free Cash Flow | 59.61M | 56.95M | 60.37M | 62.35M | 64.78M | 59.13M |
| Operating Cash Flow | 59.61M | 56.95M | 60.37M | 69.18M | 70.13M | 65.49M |
| Investing Cash Flow | -95.84M | -1.73M | 1.14M | -82.51M | -94.78M | -100.26M |
| Financing Cash Flow | 36.67M | -56.29M | -61.36M | 16.15M | 21.75M | 39.35M |
Gladstone Commercial Technical Analysis
Positive
14.62
Price Trends
14.16
Positive
14.42
Positive
15.02
Negative
Market Momentum
0.08
Negative
58.93
Neutral
90.36
Negative
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 14.62 is above the 20-day moving average (MA) of 14.43, above the 50-day MA of 14.16, and below the 200-day MA of 15.02, indicating a neutral trend. The MACD of 0.08 indicates Negative momentum. The RSI at 58.93 is Neutral, neither overbought nor oversold. The STOCH value of 90.36 is Negative, 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
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $528.20M | 18.08 | 9.57% | 7.36% | 1.82% | -1.03% | |
68 Neutral | $724.63M | 125.44 | 3.05% | 7.83% | -12.13% | -14.54% | |
66 Neutral | $681.20M | 50.55 | 7.51% | 8.21% | 3.01% | ― | |
65 Neutral | £986.33M | 11.76 | -0.08% | 5.06% | 10.32% | 31.28% | |
60 Neutral | $508.20M | ― | -6.09% | 6.51% | -8.41% | 88.62% | |
57 Neutral | $582.62M | 36.87 | -1.05% | 8.59% | 17.48% | -172.41% | |
54 Neutral | $687.53M | ― | -6.29% | 12.14% | -14.92% | -3.27% |
* Real Estate Sector Average
Performance Comparison
GOOD
Gladstone Commercial
14.62
1.37
10.34%
CTO
CTO Realty Growth
17.69
1.62
10.08%
OLP
One Liberty Properties
24.46
2.58
11.79%
AHH
Armada Hoffler Properties
7.15
-3.07
-30.04%
BRSP
BrightSpire Capital
5.27
0.02
0.38%
PKST
Peakstone Realty Trust
13.82
4.28
44.86%
Gladstone Commercial Corporate Events
Private Placements and FinancingBusiness Operations and Strategy
Gladstone Commercial Secures $20 Million Term Loan
Neutral
Jun 2, 2025
On May 30, 2025, Gladstone Commercial Limited Partnership entered into a $20 million Term Loan Agreement with KeyBank and other lenders, scheduled to mature on May 30, 2027. The unsecured loan imposes customary financial covenants and restrictions, but does not alter the company’s existing Credit Facility, potentially impacting its financial strategy and operational flexibility.
The most recent analyst rating on (GOOD) stock is a Hold with a $18.00 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.