Safehold (SAFE) AI Stock Analysis

• Market Cap: $1.27B
• Dividend Yield: 4%
• Average Volume (3M): 429.96K
• Price to Earnings (P/E): 12.0
• Beta (1Y): 0.96
• Revenue Growth: 3.70%
• EPS Growth: N/A
• Country: US
• Employees: 74
• Sector: Real Estate
• Sector Strength: 74
• Industry: REIT - Diversified
• EPS (TTM): 1.50
• Shares Outstanding: 71,785,934
• 10 Day Avg. Volume: 425,595
• 30 Day Avg. Volume: 429,956
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 3.41
• Price to Cash Flow (P/CF): 39.60
• P/FCF Ratio: 5.90
• 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: $22.11
• Price Target Upside: 33.43% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9

Safehold's stock shows promise with strong liquidity management, strategic initiatives, and improved financial performance. However, high leverage and historical volatility remain challenges. Valuation appears fair, supported by a decent dividend yield, though interest rate impacts present ongoing risks.

Positive Factors

Debt Management

Safehold announced a $400M notes offering, creating additional dry powder, while extending the debt profile of the balance sheet as the investment markets appear to be more accommodating.

Financial Performance

Safehold's earnings continue to benefit from staff rationalization measures, while deployment levels expanded in the quarter, and should further benefit from a more favorable interest rate backdrop.

Market Position

Safehold has a leading presence with a deep rolodex, first-mover advantage, and a scalable platform to profit from a more favorable backdrop, keeping analysts positive on the shares.

Negative Factors

Deal Origination

SAFE's deal origination was very light, with only $22 million at a 7.4% economic yield.

Interest Rate Environment

The volatile long-term interest rate environment continues to challenge SAFE’s ability to generate higher or better deal flow.

Investment Activity

Investment volume during the quarter was anemic, with just one new ground lease investment in a multifamily asset.

Safehold Business Overview & Revenue Model

Company Description

Safehold Inc. (NYSE: SAFE) is revolutionizing real estate ownership by providing a new and better way for owners to unlock the value of the land beneath their buildings. Through its modern ground lease capital solution, Safehold helps owners of high quality multifamily, office, industrial, hospitality and mixed-use properties in major markets throughout the United States generate higher returns with less risk. The Company, which is taxed as a real estate investment trust (REIT) and is managed by its largest shareholder, iStar Inc., seeks to deliver safe, growing income and long-term capital appreciation to its shareholders.

How the Company Makes Money

Safehold makes money primarily through the creation and management of ground leases. The company acquires land underlying commercial properties and then leases it to the property owners on a long-term basis, typically 99 years. This arrangement allows Safehold to generate steady and predictable income from lease payments over the lease term. Additionally, Safehold benefits from potential value appreciation of the land over time. The company also engages in strategic partnerships with real estate developers and owners to expand its portfolio and enhance its revenue streams. By providing an alternative capital source for property owners, Safehold participates in the growth of the real estate market while maintaining a relatively low-risk investment profile.

Safehold Financial Statement Overview

Summary

Safehold shows positive revenue and profitability trends with improved net income and free cash flow in 2024. However, high leverage and historical earnings volatility pose risks.

Income Statement

Safehold's revenue growth is consistent, with a 3.72% increase in 2024. Improvements in gross profit margin and net income indicate enhanced profitability. However, past years showed volatility in EBIT and EBITDA margins, with 2023 displaying negative EBIT. The overall profitability trend is positive, but historical fluctuations suggest caution.

Balance Sheet

The balance sheet exhibits a high debt-to-equity ratio at 1.80, indicating significant leverage, which is typical for REITs. The equity ratio of 33.98% reflects a stable equity base. ROE improved to 4.51% in 2024, showcasing better returns on equity. The high leverage poses potential risks, but the company maintains a reasonable level of equity.

Cash Flow

Free cash flow showed significant improvement in 2024, turning positive compared to previous years. Operating cash flow to net income ratio is low, indicating reliance on non-operating activities for cash. Despite recent improvements, cash flow stability remains a concern due to historical volatility.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
365.69M	352.58M	158.05M	187.01M	155.43M
	Gross Profit
361.46M	347.93M	-55.05M	184.35M	152.95M
	EBIT
87.08M	-77.08M	-7.11M	151.45M	123.84M
	EBITDA
320.36M	140.41M	229.76M	163.43M	135.92M
	Net Income Common Stockholders
105.76M	-54.97M	-197.27M	73.12M	59.29M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
15.58M	28.47M	1.44B	29.62M	56.95M
	Total Assets
6.90B	6.55B	3.25B	4.52B	3.21B
	Total Debt
4.23B	3.97B	1.60B	2.70B	1.69B
	Net Debt
4.22B	3.95B	157.90M	2.67B	1.63B
	Total Liabilities
4.53B	4.25B	1.83B	2.83B	1.83B
	Stockholders Equity
2.34B	2.23B	1.41B	1.68B	1.38B
Cash Flow		Free Cash Flow
37.85M	15.39M	24.61M	-1.22B	-21.04M
	Operating Cash Flow
37.85M	15.39M	47.67M	26.92M	35.71M
	Investing Cash Flow
-212.37M	-576.57M	2.79B	-1.29B	-530.64M
	Financing Cash Flow
144.89M	559.53M	-1.78B	1.20B	544.62M

Safehold Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 16.57
• 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 SAFE, the sentiment is Negative. The current price of 16.57 is below the 20-day moving average (MA) of 18.23, below the 50-day MA of 17.63, and below the 200-day MA of 20.48, indicating a bearish trend. The MACD of 0.09 indicates Positive momentum. The RSI at 48.06 is Neutral, neither overbought nor oversold. The STOCH value of 29.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SAFE.

Safehold Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
O	80 Outperform	$49.18B	56.32	2.40%	5.68%	29.49%	-22.38%
EPR	78 Outperform	$3.56B	29.20	6.11%	7.32%	-1.01%	-18.46%
FPI	72 Outperform	$499.31M	10.50	11.91%	2.27%	1.32%	108.94%
WPC	72 Outperform	$12.95B	28.30	5.38%	5.94%	-9.09%	-36.58%
SAFE	66 Neutral	$1.27B	11.96	4.62%	4.00%	3.70%	―
Sector *	61 Neutral	$4.43B	16.22	-3.23%	11.37%	6.25%	-21.19%
LAND	58 Neutral	$362.93M	―	1.89%	5.58%	-5.73%	-5.33%

Safehold Corporate Events

Safehold Announces Board Member Jesse Hom’s Departure

On March 20, 2025, Jesse Hom informed Safehold Inc. that he will not seek re-election to the Board of Directors at the 2025 annual meeting and will resign from all his positions effective May 15, 2025. This decision is not due to any disagreement with the company’s operations or policies, and following his resignation, the Board will reduce its size from six to five directors.

Safehold Releases Q4 and 2024 Earnings Presentation

On February 5, 2025, Safehold Inc. released its earnings presentation for the fourth quarter and fiscal year ending December 31, 2024. The presentation is available on the company’s website and is not considered filed for purposes of the Securities Exchange Act of 1934 or the Securities Act of 1933.