Stag Industrial (STAG) AI Stock Analysis

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Stag Industrial

(NYSE:STAG)

73Outperform

Stag Industrial's strong financial performance and earnings call results are the most significant factors, highlighting its revenue growth, profitability, and leasing achievements. However, high P/E valuation and technical indicators signaling potential downtrend pose risks. Global trade uncertainties and market weaknesses also contribute to a moderately positive outlook.

Positive Factors

Financial Performance

The Q3 'Core' FFO of $0.60 was above the estimate of $0.59 and in line with consensus at $0.60, indicating strong financial performance.

Leasing Activity

Leasing activity increased by 39.6% to 5.0msf compared to the long-term average, with cash leasing spreads accelerating.

Occupancy Rate

Operating portfolio occupancy improved to 97.8%, showing strong demand and efficient property management.

Negative Factors

Development Challenges

The development pipeline's completed portfolio is 0% leased, indicating potential challenges in securing tenants for new developments.

Growth Guidance

STAG's 2025 guidance was average, showing decelerating growth, with a lower end result compared to peers.

Occupancy Decline

Operating portfolio occupancy fell 50 basis points to 96.8%.

Stag Industrial (STAG) vs. S&P 500 (SPY)

Market Cap

$6.46B

Dividend Yield4.38%

Average Volume (3M)1.71M

Price to Earnings (P/E)25.6

Beta (1Y)0.62

Revenue Growth8.81%

EPS Growth33.30%

CountryUS

Employees91

SectorReal Estate

Sector Strength76

IndustryREIT - Industrial

Share Statistics

EPS (TTM)1.32

Shares Outstanding186,617,550

10 Day Avg. Volume1,145,507

30 Day Avg. Volume1,711,648

Financial Highlights & Ratios

PEG Ratio0.77

Price to Book (P/B)N/A

Price to Sales (P/S)0.00

Price to Cash Flow (P/CF)0.00

P/FCF Ratio0.00

Enterprise Value/Market Cap1.44

Enterprise Value/RevenueN/A

Enterprise Value/Gross Profit15.23

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$37.00

Price Target Upside9.24% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering6

Stag Industrial Business Overview & Revenue Model

Company DescriptionSTAG Industrial, Inc. (NYSE: STAG) is a real estate investment trust focused on the acquisition and operation of single-tenant, industrial properties throughout the United States. By targeting this type of property, STAG has developed an investment strategy that helps investors find a powerful balance of income plus growth.

How the Company Makes MoneyStag Industrial generates revenue primarily through leasing its portfolio of industrial properties to tenants. The company's business model involves acquiring properties that are leased to single tenants, often under long-term net leases where tenants are responsible for paying the majority of property operating expenses. This structure ensures a steady income stream with predictable cash flows. STAG's revenue is further enhanced by strategically acquiring properties in key logistics hubs and growing markets, allowing the company to benefit from increasing demand for industrial space driven by trends such as e-commerce and supply chain optimization. Additionally, STAG may engage in property development or redevelopment to increase property value and rental income. The company also benefits from advantageous debt financing to acquire properties, enhancing its return on equity.

Stag Industrial Financial Statement Overview

Summary

Stag Industrial demonstrates strong financial performance with significant revenue growth and profitability. The elimination of debt and robust cash flow position further enhance its financial stability. However, operational challenges affecting EBIT margin pose some concerns.

Income Statement

Positive

Stag Industrial's income statement shows a strong growth trajectory with Total Revenue increasing consistently over the years, from $405.95M in 2019 to $767.38M in 2024. Gross Profit Margin remained stable as revenue and gross profit were equal in 2024. The Net Profit Margin improved significantly from negative in 2019 to a solid 24.63% in 2024, highlighting enhanced profitability. However, EBIT Margin decreased significantly in 2024 compared to previous years, indicating increased operational expenses. Overall, the company demonstrates strong revenue growth and profitability, albeit with potential operational challenges.

Balance Sheet

Very Positive

Stag Industrial exhibits a solid balance sheet with growing Total Assets and Stockholders' Equity, reaching $6.83B and $3.46B, respectively, in 2024. The Debt-to-Equity Ratio improved significantly to 0 in 2024 due to the elimination of total debt, showcasing strong financial health and reduced risk. The Equity Ratio also remained robust at 50.58%. The Return on Equity (ROE) was strong at 5.47% in 2024. Overall, the company maintains a healthy balance sheet with no debt and strong equity, contributing to its financial stability.

Cash Flow

Positive

The cash flow statement of Stag Industrial demonstrates a strong operating cash flow, which increased steadily over the years, reaching $460.29M in 2024. The Free Cash Flow also showed positive growth, aligning with the company's profitability. The Operating Cash Flow to Net Income Ratio was high, indicating efficient cash generation relative to net income. The company shows a solid cash flow position, with improving Free Cash Flow and strong cash generation capabilities.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
767.38M	707.84M	654.38M	562.16M	483.41M
	Gross Profit
612.56M	568.24M	528.68M	454.17M	394.05M
	EBIT
270.28M	242.30M	205.39M	164.09M	137.66M
	EBITDA
561.02M	516.05M	827.94M	402.79M	352.40M
	Net Income Common Stockholders
189.22M	192.84M	104.22M	131.73M	141.83M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
36.28M	20.74M	25.88M	18.98M	15.67M
	Total Assets
6.83B	6.28B	6.18B	5.83B	4.69B
	Total Debt
3.06B	2.66B	2.53B	2.25B	1.73B
	Net Debt
3.03B	2.64B	2.51B	2.23B	1.72B
	Total Liabilities
3.30B	2.84B	2.73B	2.44B	1.92B
	Stockholders Equity
3.46B	3.37B	3.38B	3.33B	2.72B
Cash Flow		Free Cash Flow
375.06M	372.63M	335.22M	175.77M	179.10M
	Operating Cash Flow
460.29M	391.09M	387.93M	336.15M	293.92M
	Investing Cash Flow
-731.06M	-320.35M	-447.52M	-1.22B	-554.62M
	Financing Cash Flow
286.29M	-75.67M	63.19M	887.12M	269.18M

Stag Industrial Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price33.87

Price Trends

50DMA

34.16

Negative

100DMA

34.05

Negative

200DMA

35.79

Negative

Market Momentum

MACD

-0.21

Negative

RSI

55.44

Neutral

STOCH

79.86

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STAG, the sentiment is Neutral. The current price of 33.87 is above the 20-day moving average (MA) of 32.31, below the 50-day MA of 34.16, and below the 200-day MA of 35.79, indicating a neutral trend. The MACD of -0.21 indicates Negative momentum. The RSI at 55.44 is Neutral, neither overbought nor oversold. The STOCH value of 79.86 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for STAG.

Stag Industrial Risk Analysis

Stag Industrial disclosed 47 risk factors in its most recent earnings report. Stag Industrial 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 0 New Risks

Stag Industrial Peers Comparison

Overall Rating

UnderperformOutperform

Sector (60)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
STAG	73 Outperform	$6.46B	25.58	7.15%	4.38%	8.81%	33.30%
FR	70 Outperform	$6.69B	24.31	10.18%	3.17%	9.18%	-7.05%
REXR	69 Neutral	$8.12B	27.87	3.35%	4.91%	18.02%	12.12%
TRNO	66 Neutral	$5.94B	30.07	5.59%	3.33%	18.24%	6.95%
LXP	64 Neutral	$2.41B	62.64	2.98%	6.50%	5.27%	58.15%
Sector *	60 Neutral	$2.79B	11.37	0.20%	8519.74%	6.07%	-14.95%
COLD	52 Neutral	$5.54B	―	-2.73%	4.58%	-0.25%	72.06%

* Real Estate Sector Average

Performance Comparison

STAG

Stag Industrial

33.87

0.48

1.44%

TRNO

Terreno Realty

57.63

5.15

9.81%

First Industrial Realty

49.02

3.45

7.57%

LXP

LXP Industrial Trust

8.15

-0.03

-0.37%

REXR

Rexford Industrial Realty

34.30

-8.29

-19.46%

COLD

Americold Realty

19.45

-2.25

-10.37%

Stag Industrial Earnings Call Summary

Earnings Call Date:Apr 29, 2025

(Q1-2025)

% Change Since: 3.51%|

Next Earnings Date:Jul 23, 2025

Earnings Call Sentiment Positive

The earnings call presents a generally positive outlook with strong financial performance and leasing activity, despite facing challenges from global trade uncertainties and specific market weaknesses.

Q1-2025 Updates

Positive Updates

Strong Start to 2025 with Core FFO Per Share Exceeding Expectations

Core FFO per share was $0.61 in the first quarter of 2025, exceeding initial expectations and demonstrating a strong start to the year.

Significant Leasing Activity

78.5% of the operating portfolio square feet expected to be leased in 2025 has been achieved, with cash leasing spreads of 25.1%. A major lease of 500,000 square feet in the Savannah market was executed with zero downtime and a 25% cash leasing spread.

Positive Acquisition and Disposition Activity

Acquisitions in the first quarter totaled $43 million with cap rates of 6.8% and 7.0%. A building was sold in Nashua, New Hampshire for $67 million at a cash cap rate of 4.9%.

Improved Liquidity and Strong Balance Sheet

Liquidity stood at $1 billion at quarter end, with minimal debt maturities remaining in 2025. A note purchase agreement to issue $550 million of fixed rate senior unsecured notes was entered into, with a weighted average interest rate of 5.65%.

Robust Same-Store NOI Growth

Achieved same-store cash NOI growth of 3.4% for the quarter, driven by leasing spreads of 27.3% and annual escalators at 2.8%.

Negative Updates

Uncertainty Due to Global Trade War and Macroeconomic Conditions

The escalation of the global trade war has introduced uncertainty, causing some lengthening in lease gestation periods and impacting tenant decision-making.

Potential Impact of Tariffs

Tariffs may have a potential impact on business, with some tenants prioritizing diversification of their supply chains.

Challenges in Specific Markets

Weakness observed in markets such as Atlanta, San Diego, and Indianapolis, affecting overall leasing activity.

American Tire Distributors' Credit Concerns

Ongoing concerns with American Tire distributors, which are current on rents but contribute to credit loss guidance of 75 basis points.

Company Guidance

During the STAG Industrial, Inc. First Quarter 2025 Earnings Conference Call, the company provided several key metrics and guidance updates. The company's core FFO per share exceeded expectations at $0.61, while cash available for distribution grew by 8.5% to $106.5 million. Their leasing activity was robust, with 78.5% of the expected 2025 operating portfolio already leased, achieving cash leasing spreads of 25.1%. Additionally, STAG completed acquisitions worth $43 million, with cap rates between 6.8% and 7.0%. The company maintained its 2025 credit loss guidance at 75 basis points, emphasizing strong liquidity with $1 billion available at quarter-end. Moreover, they reported low leverage with a net debt to annualized run rate adjusted EBITDA ratio of 5.2 times. Despite macroeconomic uncertainties, including the global trade war and supply chain disruptions, STAG remains optimistic about its diversified portfolio and strong market positioning.

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.