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Orion Office REIT (ONL)
NYSE:ONL
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Orion Office REIT
(NYSE:ONL)
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Rating:56Neutral
Price Target:
$3.00
▲(9.09% Upside)
Orion Office REIT's overall score is primarily influenced by its financial instability and valuation concerns, despite some positive technical indicators and mixed earnings call sentiment. The company's high leverage and negative returns are significant risks, while the technical analysis suggests potential for short-term gains.
Orion Office REIT (ONL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$159.93M
Dividend Yield8.7%
Average Volume (3M)298.45K
Price to Earnings (P/E)―
Beta (1Y)1.25
Revenue Growth-15.14%
EPS Growth16.61%
CountryUS
Employees40
SectorReal Estate
Sector Strength53
IndustryREIT - Office
Share Statistics
EPS (TTM)-0.45
Shares Outstanding56,314,632
10 Day Avg. Volume257,732
30 Day Avg. Volume298,449
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap3.78
Enterprise Value/Revenue3.96
Enterprise Value/Gross Profit8.38
Enterprise Value/Ebitda14.16
Forecast
1Y Price Target
$3.00Price Target Upside9.09% Upside
Rating ConsensusHold
Number of Analyst Covering2
Orion Office REIT Business Overview & Revenue Model
Company DescriptionOrion Properties Inc. specializes in the ownership, acquisition and management of a diversified portfolio of mission-critical and corporate headquarters office buildings in high-quality suburban markets across the U.S. The portfolio is leased primarily on a single-tenant net lease basis to creditworthy tenants. The company's team of experienced industry leaders employs a proven, cycle-tested investment evaluation framework which serves as the lens through which capital allocation decisions are made for the current portfolio and future acquisitions.
How the Company Makes MoneyOrion Office REIT generates revenue primarily through leasing its office properties to tenants, collecting rental income on long-term leases. The company's revenue model is built on the consistent cash flow from these leases, which are often structured to include annual rent escalations. Additionally, ONL may benefit from ancillary revenue streams such as parking fees or service charges. The REIT may also realize capital appreciation through the appreciation of its property values over time, which can enhance total returns for shareholders. Strategic partnerships with property management firms and real estate advisors may also contribute to operational efficiencies and tenant retention, further stabilizing revenue streams.
Orion Office REIT Earnings Call Summary
Earnings Call Date:Aug 06, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 06, 2025
Earnings Call Sentiment Neutral
The call highlighted strong leasing activity, successful property dispositions, and a strategic shift towards more durable asset types, which are positive aspects. However, the company also faced a decline in total revenues, decreased core FFO and EBITDA, and increased CapEx and leasing costs. Overall, the sentiment of the call is mixed, with both positive progress and ongoing challenges.Q2-2025 Updates
Positive Updates
Strong Leasing Activity
Leasing momentum continued with 639,000 square feet completed as of July 31, 2025. This includes new and renewal transactions with a weighted average lease term of 6.4 years. Notable leases include a 15.7-year agreement for 46,000 square feet in Parsippany, New Jersey, and a 7.6-year agreement for 23,000 square feet in Plano, Texas.
Increase in Operating Property Occupancy
Orion's operating property occupancy rate increased to 77.4% at quarter end, a rise of 310 basis points sequentially. The operating property lease rate increased to 79.1%, up by 170 basis points sequentially.
Successful Property Dispositions
Closed on the sale of 4 vacant properties totaling 434,000 square feet for $26.9 million. Additionally, agreements are in place to sell 5 traditional office properties totaling 540,000 square feet for $57 million.
Shift Towards Dedicated Use Assets (DUA)
Approximately 32.2% of Orion's portfolio by annualized base rent and 25.3% by square footage are DUA properties. This percentage is expected to increase through future disposition activity and targeted acquisitions.
Improved Financial Outlook
Core FFO guidance for 2025 has been raised to $0.67 to $0.71 per diluted share. Net debt to adjusted EBITDA is expected to range from 7.3x to 8.3x, down from earlier guidance.
Negative Updates
Decline in Total Revenues
Total revenues for the second quarter were $37.3 million, down from $40.1 million in the same quarter of the prior year.
Decrease in Core FFO and Adjusted EBITDA
Core FFO for the quarter was $11.5 million or $0.20 per share, compared to $14.2 million or $0.25 per share in the same quarter of 2024. Adjusted EBITDA was $18 million versus $20.5 million in the same quarter of 2024.
Increased CapEx and Leasing Costs
CapEx and leasing costs in the second quarter were $15.6 million, significantly higher than $6.3 million in the same quarter of 2024, driven by increased leasing activity.
Higher Net Debt to Adjusted EBITDA
Net debt to annualized year-to-date adjusted EBITDA was 6.93x at quarter end, with expectations for this ratio to rise modestly in the coming year.
Company Guidance
During the Orion Properties second quarter 2025 earnings call, the company provided an optimistic outlook for the remainder of the year, reflecting strong leasing momentum and strategic asset sales. Orion completed 639,000 square feet of leasing as of July 31, with a weighted average lease term of 6.4 years, and an operating property occupancy rate increase to 77.4%, up by 310 basis points sequentially. The company sold four vacant properties totaling 434,000 square feet for $26.9 million and has agreements in place to sell five more properties for $57 million. Orion's net debt to annualized adjusted EBITDA was 6.93x at quarter-end, and they raised their core FFO guidance to between $0.67 and $0.71 per share. The company also highlighted a focus on transitioning its portfolio towards Dedicated Use Assets (DUA), which constituted 32.2% of their portfolio by annualized base rent. They reported total revenues of $37.3 million and core FFO of $11.5 million for the second quarter.Orion Office REIT Financial Statement Overview
Summary
Orion Office REIT exhibits financial instability, with declining revenues and consistent net losses impacting profitability. High leverage and negative returns signal financial stress, although cash flow management remains relatively stable. The company faces significant challenges in improving operational efficiency and achieving growth.Income Statement
The company's revenue growth is erratic with recent declines, and it has been unable to generate positive net income, leading to negative net profit margins. Gross profit margin remains stable, but negative EBIT and EBITDA margins reflect operational challenges.45
Neutral
Balance Sheet
Orion Office REIT maintains a high level of debt, reflected in a significant debt-to-equity ratio. The equity ratio indicates a reasonable level of equity financing, but the negative return on equity is concerning, driven by consistent net losses.55
Neutral
Cash Flow
Cash flow analysis shows a decrease in operating cash flow and free cash flow over time. The company has a solid free cash flow to net income ratio, but fluctuations in free cash flow growth reflect potential cash management issues.60
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 152.85M | 164.86M | 195.04M | 208.12M | 79.73M | 53.47M |
| Gross Profit | 72.18M | 99.71M | 133.75M | 146.60M | 66.32M | 47.70M |
| EBITDA | 42.71M | 30.70M | 115.54M | 130.69M | 62.49M | 44.85M |
| Net Income | -77.44M | -103.01M | -57.30M | -97.47M | -44.67M | -4.83M |
Balance Sheet | ||||||
| Total Assets | 1.29B | 1.34B | 1.42B | 1.57B | 1.76B | 546.43M |
| Cash, Cash Equivalents and Short-Term Investments | 17.38M | 15.60M | 22.47M | 20.64M | 29.32M | 0.00 |
| Total Debt | 0.00 | 510.82M | 476.93M | 540.05M | 637.46M | 37.05M |
| Total Liabilities | 558.86M | 571.17M | 536.93M | 595.22M | 671.19M | 49.31M |
| Stockholders Equity | 728.01M | 763.92M | 885.62M | 974.47M | 1.09B | 497.12M |
Cash Flow | ||||||
| Free Cash Flow | 5.52M | 31.68M | 70.65M | 102.61M | 46.19M | 41.86M |
| Operating Cash Flow | 35.57M | 54.26M | 89.09M | 114.23M | 56.11M | 42.33M |
| Investing Cash Flow | -42.94M | -51.26M | 5.29M | 22.48M | -12.26M | -464.00K |
| Financing Cash Flow | 1.88M | -3.02M | -92.49M | -110.72M | -18.44M | -41.67M |
Orion Office REIT Technical Analysis
Neutral
2.75
Price Trends
2.74
Positive
2.41
Positive
2.74
Positive
Market Momentum
0.01
Positive
45.94
Neutral
37.80
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ONL, the sentiment is Neutral. The current price of 2.75 is below the 20-day moving average (MA) of 2.89, above the 50-day MA of 2.74, and above the 200-day MA of 2.74, indicating a neutral trend. The MACD of 0.01 indicates Positive momentum. The RSI at 45.94 is Neutral, neither overbought nor oversold. The STOCH value of 37.80 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ONL.
Orion Office REIT Risk Analysis
Orion Office REIT disclosed 53 risk factors in its most recent earnings report. Orion Office REIT 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
Orion Office REIT Peers Comparison
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
65 Neutral | 280.53M | -2.19 | -19.58% | 5.76% | -3.69% | -777.30% | |
57 Neutral | 1.09B | -15.92 | -4.42% | 5.70% | -6.74% | 17.44% | |
56 Neutral | $159.93M | ― | -10.03% | 8.70% | -15.14% | 16.61% | |
49 Neutral | 169.02M | -3.16 | -8.56% | 2.45% | -18.12% | 24.44% | |
48 Neutral | 30.65M | -0.08 | -27.60% | 9.64% | -11.93% | -1877.17% | |
41 Neutral | 26.30M | -0.28 | -164.27% | ― | -11.84% | 52.84% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% |
* Real Estate Sector Average
Performance Comparison
ONL
Orion Office REIT
2.75
-1.03
-27.25%
FSP
Franklin Street Properties
1.63
-0.03
-1.81%
PDM
Piedmont Office
8.77
-0.87
-9.02%
OPI
Office Properties Income
0.41
-1.64
-80.00%
CIO
City Office REIT
6.95
1.47
26.82%
NYC
New York City REIT
10.00
0.99
10.99%
Orion Office REIT Corporate Events
Shareholder MeetingsBusiness Operations and Strategy
Orion Office REIT Approves Equity Plan Amendment
Positive
May 14, 2025
On May 14, 2025, Orion Properties Inc., a real estate investment trust, held its Annual Meeting where stockholders approved an amendment to the 2021 Equity Incentive Plan, increasing the number of shares issuable from 3,700,000 to 8,300,000. Additionally, stockholders elected five directors and ratified KPMG as the independent registered public accounting firm for the fiscal year ending December 31, 2025, reflecting strong shareholder support for the company’s strategic decisions.
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.