Office Properties Income (OPI) AI Stock Analysis

• Market Cap: $23.16M
• Dividend Yield: 12.06%
• Average Volume (3M): 956.52K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.71
• Revenue Growth: -5.92%
• EPS Growth: -54.08%
• Country: US
• Employees: N/A
• Sector: Real Estate
• Sector Strength: 77
• Industry: REIT - Office
• EPS (TTM): -2.21
• Shares Outstanding: 69,824,745
• 10 Day Avg. Volume: 636,741
• 30 Day Avg. Volume: 956,523
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.08
• Price to Cash Flow (P/CF): 0.40
• P/FCF Ratio: 0.20
• 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: $0.75
• Price Target Upside: 87.50% Upside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 0

Office Properties Income's stock performance is primarily hindered by its financial difficulties, including declining revenues, negative net income, and high leverage. The technical analysis reflects a bearish trend, although oversold conditions may offer short-term relief. While the valuation is unattractive due to the negative P/E ratio, the high dividend yield could be appealing to some investors. The earnings call highlighted some positive developments in debt management and leasing, but these are overshadowed by revenue declines and high vacancy rates. Overall, the company's current challenges outweigh its strengths, resulting in a low stock score.

Office Properties Income Business Overview & Revenue Model

Company Description

OPI is a REIT focused on owning, operating and leasing properties primarily leased to single tenants and those with high credit quality characteristics such as government entities. OPI is managed by the operating subsidiary of The RMR Group Inc. (Nasdaq: RMR), an alternative asset management company that is headquartered in Newton, Massachusetts.

How the Company Makes Money

Office Properties Income Trust generates revenue primarily through the leasing of office spaces to tenants. The company's revenue model is based on collecting rental income from its portfolio of office properties. OPI targets properties in established and growing markets, ensuring a steady demand for office spaces. The trust's earnings are driven by long-term lease agreements, which provide stable cash flows. Additionally, OPI's revenue can be influenced by property acquisitions and dispositions, which help optimize the portfolio's performance. The company may also engage in strategic partnerships or joint ventures to enhance its real estate holdings and increase its income potential. By maintaining high occupancy rates and effectively managing its properties, OPI aims to achieve steady financial growth.

Office Properties Income Financial Statement Overview

Summary

Office Properties Income faces ongoing financial difficulties, marked by declining revenues, negative net income, and increasing leverage. Despite maintaining a strong gross profit margin, the company's profitability and cash flow generation are concerning. The high debt levels pose a potential risk, and the negative return on equity further indicates challenges in generating shareholder value.

Income Statement

The company has experienced a consistent decline in revenue over the years, with a significant drop from $678M in 2019 to $502M in 2024. Gross profit margin has decreased from 89% in 2019 to 88% in 2024, although it remains strong. However, net income has been negative for the last four years, indicating persistent profitability challenges. The EBIT and EBITDA margins have also shown fluctuations, with EBIT margin decreasing to approximately 61% in 2024, suggesting operational difficulties.

Balance Sheet

The debt-to-equity ratio has increased over the years, reaching 2.21 in 2024, indicating a high level of leverage. Stockholders' equity has decreased from $1.7B in 2019 to $1.15B in 2024, and the equity ratio has declined, pointing towards financial instability. Return on equity is negative due to consistent net losses, which is a concern for investors seeking returns.

Cash Flow

Operating cash flow has decreased significantly from $234M in 2020 to $67M in 2024. Free cash flow has also seen a reduction, although it remains positive at $67M in 2024. The operating cash flow to net income ratio is distorted due to net losses, and the free cash flow to net income ratio is unfavorable, reflecting cash flow challenges despite capital expenditure reductions.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
501.98M	533.55M	554.27M	576.48M	587.92M
	Gross Profit
439.61M	360.84M	496.43M	504.51M	522.80M
	EBIT
304.74M	334.06M	111.58M	105.09M	112.72M
	EBITDA
223.34M	302.34M	334.14M	348.45M	368.12M
	Net Income Common Stockholders
-136.11M	-69.43M	-2.60M	-5.68M	6.68M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
261.32M	12.31M	12.25M	83.03M	42.05M
	Total Assets
3.82B	3.99B	3.98B	4.24B	3.95B
	Total Debt
2.54B	2.58B	2.45B	2.59B	2.21B
	Net Debt
2.28B	2.57B	2.43B	2.51B	2.17B
	Total Liabilities
2.67B	2.73B	2.59B	2.74B	2.34B
	Stockholders Equity
1.15B	1.26B	1.39B	1.50B	1.61B
Cash Flow		Free Cash Flow
67.17M	141.73M	-11.49M	121.35M	151.87M
	Operating Cash Flow
67.17M	141.73M	192.61M	221.49M	233.63M
	Investing Cash Flow
66.61M	-194.82M	-4.62M	-442.99M	-22.99M
	Financing Cash Flow
114.67M	67.56M	-260.26M	249.15M	-254.48M

Office Properties Income Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.40
• 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 OPI, the sentiment is Negative. The current price of 0.4 is above the 20-day moving average (MA) of 0.38, below the 50-day MA of 0.63, and below the 200-day MA of 1.40, indicating a neutral trend. The MACD of -0.08 indicates Negative momentum. The RSI at 42.63 is Neutral, neither overbought nor oversold. The STOCH value of 54.17 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for OPI.

Office Properties Income Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	59 Neutral	$2.73B	11.72	0.09%	8795.52%	5.45%	-17.33%
CIO	55 Neutral	$201.39M	―	-2.35%	8.02%	-4.45%	-147.11%
PDM	52 Neutral	$829.80M	―	-4.78%	7.38%	-5.58%	-63.09%
FSP	51 Neutral	$163.64M	―	-7.70%	2.52%	-19.86%	-9.50%
ONL	50 Neutral	$99.98M	―	-12.49%	18.29%	-15.46%	-81.31%
OPI	46 Neutral	$23.16M	―	-11.33%	12.06%	-5.92%	-54.08%
NYC	41 Neutral	$30.37M	―	-90.59%	―	-1.36%	-19.10%

Office Properties Income Corporate Events

Office Properties Income Trust’s Note Exchange Discussions

Office Properties Income Trust engaged in confidential discussions with certain parties regarding a proposed transaction involving the exchange of its outstanding senior unsecured notes for new notes with similar terms to its 8.000% Senior Priority Guaranteed Unsecured Notes due 2029. However, the parties could not reach an agreement on the rate, scope of unsecured guarantees, covenants, and other terms. This disclosure was made to satisfy public disclosure obligations under confidentiality agreements, but the information should not be considered a reliable prediction of future events.