Sachem Capital (SACH) AI Stock Analysis

• Market Cap: $54.88M
• Dividend Yield: 27.62%
• Average Volume (3M): 355.02K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.69
• Revenue Growth: -11.58%
• EPS Growth: -431.61%
• Country: US
• Employees: 29
• Sector: Real Estate
• Sector Strength: 74
• Industry: REIT - Mortgage
• EPS (TTM): -0.93
• Shares Outstanding: 47,310,140
• 10 Day Avg. Volume: 309,580
• 30 Day Avg. Volume: 355,018
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 4.15
• Price to Cash Flow (P/CF): 17.30
• P/FCF Ratio: 2.10
• 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: $1.25
• Price Target Upside: 19.05% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 2

Sachem Capital faces significant financial challenges, with negative profitability and operational inefficiencies. While the new credit facility offers some liquidity, the company's high dividend yield and negative P/E ratio raise concerns about valuation sustainability. Technical indicators are neutral, and despite strategic partnerships, the outlook remains cautious due to financial pressures.

Positive Factors

Business Diversification

Sachem Capital Corp. invested $2.5M in Shem Creek, adding diversification to its business model.

Negative Factors

Dividend Reduction

The third-quarter dividend was reduced to $0.05 from $0.08 as the company focuses on preserving liquidity.

Financial Performance

Sachem Capital Corp. reported a third-quarter GAAP loss of $0.13 per share, significantly impacted by an increase to CECL reserves.

Sachem Capital Business Overview & Revenue Model

Company Description

Sachem Capital Corp. (SACH) is a real estate finance company specializing in originating, underwriting, funding, servicing, and managing a portfolio of short-term loans secured by first mortgage liens on real property located primarily in the Northeastern United States and Florida. The company primarily serves real estate investors and developers, providing them with quick and flexible financing solutions for property acquisitions, renovations, and development projects.

How the Company Makes Money

Sachem Capital generates revenue primarily through the interest and fees it charges on its real estate loans. These loans are typically short-term in nature and secured by first mortgage liens on real estate properties, which reduces the risk of default. The company also earns income through origination fees, exit fees, and other related charges associated with the creation and servicing of these loans. By focusing on a niche market of short-term, real estate-secured loans, Sachem Capital leverages its expertise and market knowledge to efficiently manage risk and optimize returns. Additionally, the company may engage in strategic partnerships with other financial institutions or real estate developers to further enhance its revenue streams and market reach.

Sachem Capital Financial Statement Overview

Summary

Sachem Capital demonstrates strong revenue growth and solid gross profit margins, yet faces profitability challenges as evidenced by the recent negative net income. The balance sheet is moderately leveraged with a stable equity position, but the rising debt levels require careful attention. Cash flow generation is positive but inconsistent, necessitating improvements in profitability to sustain future growth.

Income Statement

The company's revenue has grown significantly in the TTM (Trailing-Twelve-Months), showing a 111% increase from the previous year. However, the net income has turned negative, which is a concern for profitability. Gross profit margin remains strong at a high percentage, indicating effective cost management, but the negative net income margin reflects underlying profitability issues.

Balance Sheet

The balance sheet shows a reasonable debt-to-equity ratio of 1.35, indicating moderate leverage. The equity ratio stands at 39.7%, suggesting a stable financial position with a significant portion of the company's assets financed by equity. However, the increase in total debt over the years presents potential risk if not managed effectively.

Cash Flow

Operating cash flow remains positive, but free cash flow growth has been inconsistent. The operating cash flow to net income ratio is not favorable due to the negative net income, impacting cash flow efficiency. Although there is positive free cash flow, it is critical to monitor the sustainability of cash generation given the recent negative net income.

Breakdown
TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement		Total Revenue
63.38M	30.04M	30.77M	19.84M	13.05M	9.71M
	Gross Profit
62.80M	30.04M	30.73M	19.67M	13.04M	9.67M
	EBIT
20.73M	18.29M	20.91M	13.32M	8.99M	6.20M
	EBITDA
11.35M	0.00	106.41K	0.00	0.00	0.00
	Net Income Common Stockholders
-4.55M	15.90M	20.91M	13.32M	8.99M	6.20M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
99.31K	12.60M	48.29M	102.57M	56.70M	34.79M
	Total Assets
86.01M	625.54M	565.66M	417.96M	226.67M	141.21M
	Total Debt
27.51M	345.89M	284.39M	194.49M	138.78M	56.34M
	Net Debt
27.41M	333.29M	260.67M	152.55M	119.37M	37.49M
	Total Liabilities
33.21M	395.46M	347.95M	237.88M	145.75M	58.65M
	Stockholders Equity
52.80M	230.07M	217.71M	180.08M	80.92M	82.56M
Cash Flow		Free Cash Flow
16.43M	21.86M	11.57M	27.26M	9.48M	7.87M
	Operating Cash Flow
16.42M	21.86M	13.15M	28.08M	9.63M	8.12M
	Investing Cash Flow
39.35M	-72.49M	-159.54M	-166.27M	-82.82M	-37.82M
	Financing Cash Flow
-75.71M	39.52M	128.16M	160.72M	73.76M	48.38M

Sachem Capital Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.05
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SACH, the sentiment is Negative. The current price of 1.05 is below the 20-day moving average (MA) of 1.16, below the 50-day MA of 1.10, and below the 200-day MA of 1.78, indicating a bearish trend. The MACD of <0.01 indicates Positive momentum. The RSI at 52.58 is Neutral, neither overbought nor oversold. The STOCH value of 44.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SACH.

Sachem Capital Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PMT	68 Neutral	$1.27B	10.68	8.24%	11.09%	-16.66%	-23.98%
LADR	68 Neutral	$1.42B	13.03	7.06%	8.21%	-5.09%	6.25%
ARI	61 Neutral	$1.28B	―	-6.02%	11.90%	-9.71%	-426.57%
Sector *	61 Neutral	$4.72B	17.64	-3.07%	10.89%	5.99%	-21.86%
SACH	50 Neutral	$54.88M	―	-19.22%	27.62%	-11.58%	-431.61%
RWT	47 Neutral	$803.81M	18.77	4.13%	11.73%	27.92%	―
RC	43 Neutral	$884.91M	―	-19.41%	18.99%	-24.40%	-210.65%

Sachem Capital Corporate Events

Sachem Capital Secures New $50 Million Credit Facility

On March 20, 2025, Sachem Capital Corp. entered into a new $50 million revolving credit facility with Needham Bank, replacing its previous $65 million facility. This new agreement involves SN Holdings, a wholly-owned subsidiary, as the borrower, and includes provisions for asset liens and collateral requirements. The facility is set to expire on March 2, 2026, with a potential one-year extension. The company also reported its financial results for 2024, showing a decline in revenue to $57.5 million from $64.7 million in 2023, primarily due to fewer loan originations and reduced interest income. Operating costs increased significantly, leading to a net loss of $43.9 million for the year, compared to a net income of $12.1 million in 2023. Total assets decreased to $492 million, and shareholders’ equity fell to $181.7 million by year-end 2024.