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Peakstone Realty Trust (PKST)
:PKST
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Peakstone Realty Trust
(NYSE:PKST)
Rating:57Neutral
Price Target:
$12.00
▲( 0.33% Upside)
Peakstone Realty Trust (PKST) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$440.54M
Dividend Yield7.52%
Average Volume (3M)135.50K
Price to Earnings (P/E)―
Beta (1Y)1.11
Revenue Growth-8.41%
EPS Growth88.62%
CountryUS
Employees38
SectorReal Estate
Sector Strength64
IndustryREIT - Diversified
Share Statistics
EPS (TTM)-1.35
Shares Outstanding36,772,846
10 Day Avg. Volume132,773
30 Day Avg. Volume135,503
Financial Highlights & Ratios
PEG Ratio-0.57
Price to Book (P/B)0.42
Price to Sales (P/S)0.00
P/FCF Ratio4.84
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$13.00Price Target Upside8.70% Upside
Rating ConsensusHold
Number of Analyst Covering3
Peakstone Realty Trust Business Overview & Revenue Model
Company DescriptionPeakstone Realty Trust (PKST) is a real estate investment trust (REIT) that focuses on acquiring, managing, and investing in a diversified portfolio of commercial real estate properties. The company primarily operates in the office and industrial sectors, providing leasing, property management, and investment services to tenants and investors. With a strategic emphasis on high-quality assets in key markets, Peakstone Realty Trust aims to deliver sustainable income and long-term value appreciation to its shareholders.
How the Company Makes MoneyPeakstone Realty Trust generates revenue primarily through leasing its portfolio of office and industrial properties to tenants. The company earns rental income from these leases, which forms the core of its revenue model. Additionally, PKST may engage in property management services, earning fees for managing properties on behalf of third-party owners. The company also looks to capitalize on value appreciation through strategic property acquisitions and dispositions, which can contribute to earnings through capital gains. Partnerships with key stakeholders in the real estate industry and effective asset management strategies are significant factors that support PKST's revenue growth and operational efficiency.
Peakstone Realty Trust Financial Statement Overview
Summary
Peakstone Realty Trust faces financial challenges with declining revenues, negative net income, and high leverage. Despite positive operating cash flows, the company must manage its high debt levels and operational inefficiencies.Income Statement
Peakstone Realty Trust's income statement reveals significant challenges. The company has experienced declining revenues over the past two years, with a drop from $416.5 million in 2022 to $228.1 million in 2024. This has resulted in negative net income in recent years, with a net loss of $10.4 million in 2024. Although the gross profit margin remains relatively high, the lack of EBIT in 2024 and fluctuating EBITDA margins indicate operational inefficiencies and potential cost management issues.45
Neutral
Balance Sheet
The balance sheet shows a highly leveraged position, with a debt-to-equity ratio of approximately 1.33 in 2024. Stockholders' equity has decreased, reflecting declining asset values and persistent liabilities. The equity ratio stands at around 40.54%, indicating a moderate level of financial stability. Despite a strong asset base, the high debt levels pose a risk to financial flexibility.55
Neutral
Cash Flow
The cash flow statement indicates some resilience, with stable free cash flow of $94.7 million in 2024, an improvement from negative free cash flow in 2022. Operating cash flow has remained positive, reflecting effective cash management from core operations. However, the high investing cash outflows and negative net income raise concerns about long-term cash sustainability.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 228.07M | 254.28M | 416.49M | 459.87M | 397.45M | Gross Profit |
| 184.35M | 89.65M | 326.72M | 357.37M | 302.40M | EBIT |
| 0.00 | 45.54M | 81.20M | 102.19M | 93.26M | EBITDA |
| 145.67M | -427.27M | 271.94M | 306.30M | 254.32M | Net Income Common Stockholders |
| -10.43M | -550.58M | -401.67M | 11.50M | -4.04M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 146.51M | 418.74M | 233.18M | 168.62M | 168.95M | Total Assets |
| 2.68B | 2.79B | 3.63B | 5.27B | 4.15B | Total Debt |
| 1.44B | 1.48B | 1.53B | 2.58B | 2.19B | Net Debt |
| 1.29B | 1.09B | 1.30B | 2.41B | 2.02B | Total Liabilities |
| 1.52B | 1.59B | 1.65B | 2.77B | 2.41B | Stockholders Equity |
| 1.09B | 1.11B | 1.81B | 2.28B | 1.51B |
| Cash Flow | Free Cash Flow | |||
| 94.66M | 89.15M | -999.13M | 181.49M | 163.01M | Operating Cash Flow |
| 94.66M | 89.15M | 152.68M | 204.98M | 164.54M | Investing Cash Flow |
| -215.84M | 308.56M | 1.10B | -62.81M | -24.97M | Financing Cash Flow |
| -125.62M | -234.64M | -1.20B | -159.34M | -49.52M |
Peakstone Realty Trust Technical Analysis
Neutral
11.96
Price Trends
12.02
Negative
11.40
Positive
12.01
Negative
Market Momentum
0.09
Negative
51.48
Neutral
36.80
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PKST, the sentiment is Neutral. The current price of 11.96 is above the 20-day moving average (MA) of 11.81, below the 50-day MA of 12.02, and below the 200-day MA of 12.01, indicating a neutral trend. The MACD of 0.09 indicates Negative momentum. The RSI at 51.48 is Neutral, neither overbought nor oversold. The STOCH value of 36.80 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for PKST.
Peakstone Realty Trust Risk Analysis
Peakstone Realty Trust disclosed 63 risk factors in its most recent earnings report. Peakstone Realty Trust 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 3 New Risks
1.
We may not be able to effectively monitor the credit quality, or identify material changes in the credit quality, of tenants and/or their parent companies and guarantors, as applicable. Q4, 2024
2.
As of December 31, 2024, we had $1.36 billion of indebtedness outstanding, which requires substantial cash flow to service, subjects us to risk of default, which could have a material adverse effect on us. Q4, 2024
3.
Our unsecured credit facility and certain of our secured indebtedness contain, and any other future indebtedness we incur may contain, various covenants, including business activity restrictions, and the failure to comply with those covenants could have a material adverse effect on us. Q4, 2024
Peakstone Realty Trust Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $705.37M | 122.11 | 3.05% | 11.05% | -12.13% | -14.54% | |
70 Neutral | $507.68M | 17.38 | 9.57% | 7.64% | 1.82% | -1.03% | |
65 Neutral | $645.32M | 47.89 | 7.51% | 8.71% | 3.01% | ― | |
60 Neutral | $2.76B | 10.33 | 0.49% | 8508.28% | 5.95% | -17.56% | |
60 Neutral | $584.59M | 36.87 | -1.05% | 8.56% | 17.48% | -172.41% | |
57 Neutral | $440.54M | ― | -6.09% | 7.52% | -8.41% | 88.62% | |
50 Neutral | $662.75M | ― | -6.29% | 13.38% | -14.92% | -3.27% |
* Real Estate Sector Average
Performance Comparison
PKST
Peakstone Realty Trust
11.98
0.24
2.04%
CTO
CTO Realty Growth
17.84
1.75
10.88%
GOOD
Gladstone Commercial
13.85
0.75
5.73%
OLP
One Liberty Properties
23.51
1.93
8.94%
AHH
Armada Hoffler Properties
6.96
-3.56
-33.84%
BRSP
BrightSpire Capital
5.03
-0.38
-7.02%
Peakstone Realty Trust Earnings Call Summary
Earnings Call Date:May 08, 2025
(Q1-2025)
| % Change Since: 6.69%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Positive
The earnings call conveyed a positive sentiment overall, with significant achievements in strategic transitions, successful asset sales, and improved financial metrics. Despite reporting a net loss and challenges in reaching target leverage, the company's strategic focus and execution in the industrial sector are promising.Q1-2025 Updates
Positive Updates
Strategic Transition to Industrial REIT
Peakstone Realty Trust continues to make progress in transitioning to an industrial REIT, with a focus on the industrial outdoor storage (iOS) subsector, increasing industrial segment ABR by $2,400,000 quarter over quarter.
Successful Office Asset Sales
Closed $144,000,000 of office asset sales year to date, with office dispositions continuing to align with strategic goals. Completed the sale of two properties for $34,000,000 and three additional properties for $110,000,000.
Leasing Achievements
Fully leased the largest iOS redevelopment property in Everett, Washington, contributing $1,700,000 of incremental ABR to the industrial segment. New lease in Mableton, Georgia added $300,000 in ABR.
Strong Financial Metrics
Total revenue reached approximately $57,000,000, and cash NOI approximately $46,000,000. Same store cash NOI increased 5.8% for the industrial segment and 3.1% for the office segment.
Improved Leverage Position
Reduced net debt to adjusted EBITDAre to 6.8 times after paying down $100,000,000 of revolver, with total liquidity of approximately $330,000,000.
Negative Updates
Net Loss
Reported a net loss attributable to common shareholders of approximately $49,400,000 or $1.35 per share, including a $52,000,000 noncash impairment related to potential sales of assets in the office segment.
Challenges in Achieving Target Leverage
While leverage improved to 6.8 times, the company's target leverage remains in the six times range or below, indicating ongoing efforts are needed to reach desired levels.
Company Guidance
In the Peakstone Realty Trust's First Quarter 2025 earnings call, the company provided detailed guidance on its ongoing strategic transition to an industrial real estate investment trust (REIT) with a focus on the industrial outdoor storage (iOS) subsector. Key metrics highlighted include a $2.4 million increase in industrial segment Annualized Base Rent (ABR) quarter over quarter, driven by a 10% rise in ABR from iOS properties. The company also completed approximately $144 million in office asset sales year-to-date, advancing their portfolio realignment efforts. Industrial segment ABR represented 41% of total ABR at quarter end and 43% on a pro forma basis. The company signed a nine-point-eight-year lease for its largest iOS redevelopment property in Everett, Washington, contributing approximately $1.7 million of incremental ABR with 8% annual rent escalations. Financial results for the quarter showed total revenue at $57 million, cash NOI at $46 million, and a net loss of $49.4 million, which included a $52 million non-cash impairment related to office asset sales. Pro forma metrics after office dispositions indicated total debt at approximately $1.26 billion, with a net debt to adjusted EBITDAre ratio of 6.8 times. The company also maintained a balanced approach towards future acquisitions and office asset dispositions to enhance shareholder value and reduce leverage.Peakstone Realty Trust Corporate Events
Executive/Board ChangesPrivate Placements and Financing
Peakstone Realty Trust’s Strategic Financial and Leadership Moves
Positive
Nov 4, 2024
Peakstone Realty Trust made significant financial moves, including a $175 million senior unsecured term loan set to mature in 2027, with flexible interest rates based on SOFR. The company also expanded its leadership team by appointing Cindy Mai as Chief Accounting Officer, offering her a competitive compensation package. Additionally, Peakstone secured mortgage loans for properties in Florida, Georgia, and Illinois, with fixed interest rates and terms ranging from 5 to 7.5 years, ensuring steady interest-only payments.
M&A TransactionsBusiness Operations and Strategy
Peakstone Realty Trust Expands with Major Acquisition
Positive
Nov 4, 2024
Peakstone Realty Trust has expanded its industrial portfolio by acquiring 51 industrial outdoor storage properties from a joint venture between Alterra IOS and J.P. Morgan Asset Management for $490 million. This strategic acquisition boosts Peakstone’s presence in a high-growth sector characterized by favorable dynamics and supply constraints, offering a potential 70% mark-to-market opportunity. The portfolio, spanning 440 acres across 14 states, is nearly fully leased to diverse tenants, enhancing Peakstone’s long-term growth and positioning it favorably within the industrial market.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.