ESR-REIT (9A4U) AI Stock Analysis

• Market Cap: $2.23B
• Dividend Yield: 7.63%
• Average Volume (3M): 897.06K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.74
• Revenue Growth: 10.51%
• EPS Growth: -40.93%
• Country: SG
• Employees: 83
• Sector: Real Estate
• Sector Strength: 53
• Industry: REIT - Industrial
• EPS (TTM): N/A
• Shares Outstanding: 803,677,200
• 10 Day Avg. Volume: 792,330
• 30 Day Avg. Volume: 897,061
• PEG Ratio: -0.68
• Price to Book (P/B): 4.55
• Price to Sales (P/S): 32.16
• P/FCF Ratio: 48.95
• Enterprise Value/Market Cap: 0.00
• Enterprise Value/Revenue: 0.00
• Enterprise Value/Gross Profit: 0.00
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $3.64
• Price Target Upside: 30.96% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): 0.22
• Revenue Forecast (FY): $565.08M

• Rating: 56 Neutral
• Price Target: S$3.00 ▲(7.91% Upside)

The overall stock score is driven by strong technical indicators, despite significant profitability challenges and high leverage. The attractive dividend yield provides some support, but the negative P/E ratio highlights valuation concerns. Improving profitability and managing debt are crucial for enhancing financial stability.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand for ESR-REIT's properties, driven by strategic acquisitions and the thriving logistics sector.

Credit Rating

A 'BBB' rating with a stable outlook reflects a solid business model and disciplined capital management, supporting long-term financial stability.

Cash Flow Generation

Strong operating cash flow indicates efficient cash generation, providing financial flexibility to support growth and manage debt.

Negative Factors

Profitability Challenges

Negative net profit margin highlights significant profitability challenges, which could hinder reinvestment and long-term growth.

High Leverage

High leverage poses risks to financial stability, potentially limiting the ability to invest in growth opportunities or weather economic downturns.

Declining Free Cash Flow

Declining free cash flow growth may strain cash reserves, affecting the ability to fund operations and future investments sustainably.

ESR-REIT Business Overview & Revenue Model

Company Description

ESR-REIT (9A4U) is a Singapore-based real estate investment trust (REIT) that primarily invests in a diversified portfolio of income-producing industrial properties, focusing on logistics and warehousing facilities. The company aims to deliver sustainable returns to its unitholders through strategic acquisitions and active asset management, targeting properties that benefit from the growth of e-commerce and logistics sectors in the Asia-Pacific region.

How the Company Makes Money

ESR-REIT generates revenue primarily through rental income derived from its portfolio of industrial properties, which are leased to a diverse range of tenants. Key revenue streams include long-term leases with established logistics and industrial companies, providing a stable cash flow. The REIT also benefits from periodic rent escalations and the potential for capital appreciation of its properties. Additionally, ESR-REIT may engage in property development or redevelopment projects, enhancing the value of its assets and increasing rental income potential. Strategic partnerships with leading logistics firms and developers further bolster its earnings by ensuring high occupancy rates and attracting quality tenants.

ESR-REIT Financial Statement Overview

Summary

ESR-REIT shows strong revenue growth but faces significant profitability challenges, with a negative net profit margin and high leverage. Cash flow generation is strong, but declining free cash flow growth is concerning. The company needs to improve profitability and manage debt levels.

Income Statement

The income statement shows a mixed performance. Revenue growth is strong at 42.53% in the latest year, indicating a positive trend. However, the net profit margin is negative at -34.49%, reflecting significant profitability challenges. The gross profit margin is healthy at 70.62%, but the EBIT margin is low at 2.31%, suggesting high operating expenses relative to revenue.

Balance Sheet

The balance sheet reveals a moderate financial position. The debt-to-equity ratio is 1.09, indicating a relatively high leverage, which could pose risks if not managed carefully. Return on equity is negative at -4.88%, highlighting profitability issues. The equity ratio is not provided, but the overall leverage suggests a need for cautious financial management.

Cash Flow

Cash flow analysis shows some strengths and weaknesses. Operating cash flow is strong with a coverage ratio of 1.09, indicating good cash generation relative to net income. However, free cash flow growth is negative at -20.11%, pointing to potential challenges in maintaining cash reserves. The free cash flow to net income ratio is high at 0.90, suggesting efficient cash conversion despite net losses.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	415.84M	370.50M	386.35M	348.57M	248.99M	229.92M
Gross Profit	281.48M	261.65M	251.24M	228.38M	173.26M	164.21M
EBITDA	0.00	8.56M	244.89M	217.87M	155.65M	126.26M
Net Income	-86.03M	-127.78M	-67.45M	-278.26M	101.52M	9.69M
Balance Sheet
Total Assets	5.91B	6.01B	5.11B	5.65B	3.33B	3.19B
Cash, Cash Equivalents and Short-Term Investments	67.69M	83.94M	41.98M	45.58M	24.15M	18.10M
Total Debt	2.81B	2.86B	2.15B	2.61B	1.41B	1.45B
Total Liabilities	3.25B	3.33B	2.34B	2.81B	1.58B	1.59B
Stockholders Equity	2.59B	2.62B	2.77B	2.75B	1.75B	1.60B
Cash Flow
Free Cash Flow	315.09M	243.43M	167.27M	95.06M	124.29M	150.50M
Operating Cash Flow	315.09M	269.62M	260.08M	193.63M	152.77M	161.44M
Investing Cash Flow	-486.99M	-436.95M	360.85M	-267.02M	-149.34M	-6.12M
Financing Cash Flow	182.43M	200.41M	-626.33M	93.14M	2.62M	-152.88M

ESR-REIT Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2.78
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SG:9A4U, the sentiment is Positive. The current price of 2.78 is above the 20-day moving average (MA) of 2.77, below the 50-day MA of 2.81, and above the 200-day MA of 2.49, indicating a neutral trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 48.67 is Neutral, neither overbought nor oversold. The STOCH value of 66.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SG:9A4U.

ESR-REIT Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BUOU	72 Outperform	$3.73B	18.11	4.77%	6.07%	2.01%	38.17%
O5RU	70 Outperform	S$1.19B	34.27	3.38%	6.61%	1.72%	-21.69%
JYEU	70 Neutral	S$1.58B	29.26	2.88%	7.95%	-6.64%	-12.15%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
M44U	64 Neutral	$6.72B	31.73	3.18%	5.88%	-1.81%	-18.43%
9A4U	56 Neutral	$2.23B	-19.48	-4.88%	7.63%	10.51%	-40.93%
TS0U	56 Neutral	S$1.90B	-24.82	-2.15%	6.03%	-11.65%	-137.98%

ESR-REIT Corporate Events

ESR-REIT Achieves ‘BBB’ Rating with Stable Outlook from Fitch

ESR-REIT has received a ‘BBB’ rating with a stable outlook from Fitch Ratings, reflecting its strong business model and disciplined capital management. This rating applies to its outstanding unsecured notes, indicating a stable financial position and commitment to delivering long-term value to stakeholders.