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Artis Real Estate Investment (TSE:AX.UN)
TSX:AX.UN
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Artis Real Estate Investment
(TSX:AX.UN)
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Rating:55Neutral
Price Target:
C$7.50
▲(23.76% Upside)
Artis Real Estate Investment's overall stock score is driven by its financial performance and earnings call insights. While the company faces profitability challenges, its strategic initiatives in leasing and deleveraging provide a positive outlook. The high dividend yield adds appeal, but technical indicators suggest caution.
Positive Factors
Negative Factors
Artis Real Estate Investment (AX.UN) vs. iShares MSCI Canada ETF (EWC)
Market Cap
$585.50M
Dividend Yield9.9%
Average Volume (3M)330.93K
Price to Earnings (P/E)―
Beta (1Y)0.92
Revenue Growth-21.40%
EPS Growth71.00%
CountryCA
Employees143
SectorReal Estate
Sector Strength53
IndustryREIT - Diversified
Share Statistics
EPS (TTM)-0.27
Shares Outstanding96,617,290
10 Day Avg. Volume737,157
30 Day Avg. Volume330,928
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap3.38
Enterprise Value/Revenue7.71
Enterprise Value/Gross Profit14.81
Enterprise Value/Ebitda86.75
Forecast
1Y Price Target
$7.50Price Target Upside23.78% Upside
Rating ConsensusModerate Sell
Number of Analyst Covering1
Artis Real Estate Investment Business Overview & Revenue Model
Company DescriptionArtis is a diversified Canadian real estate investment trust investing in industrial and office properties in Canada and the United States. Since 2004, Artis has executed an aggressive but disciplined growth strategy, building a portfolio of commercial properties in select markets in Canada and the United States. As of September 30, 2020, Artis' commercial property comprises approximately 23.8 million square feet of leasable area.
How the Company Makes MoneyArtis Real Estate Investment generates revenue primarily through rental income derived from its diverse portfolio of properties. The company leases its commercial, industrial, and retail spaces to a wide range of tenants, which provides a steady cash flow. Additionally, Artis may realize income through property management fees and service charges related to the maintenance and operation of its properties. The trust also benefits from strategic partnerships and joint ventures that enhance its operational capabilities and market reach. By actively managing its property portfolio and optimizing occupancy rates, Artis maximizes its revenue potential while focusing on long-term value creation for its investors.
Artis Real Estate Investment Earnings Call Summary
Earnings Call Date:Aug 07, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Oct 30, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a stable and strategically productive quarter with positive developments in leasing, occupancy, and deleveraging. However, challenges such as elevated payout ratios, increased debt to gross book value, and strategic review costs remain. The company is actively managing these challenges while exploring growth opportunities.Q2-2025 Updates
Positive Updates
Increased Occupancy Rates
Occupancy rates rose to 87.8% as of June 30 from 87.1% at March 31, driven by a new 80,600 square foot lease in the U.S. industrial portfolio.
Successful Lease Renewals
210,643 square feet of renewals commenced during the quarter with rental rates increasing by 3.6%, indicating strong tenant relationships and asset strength.
Deleveraging Initiatives
Closed on the sale of a Canadian retail property for $4.8 million and went unconditional on the sale of a 90% interest in U.S. development land for USD 11.3 million, contributing to deleveraging efforts.
Repurchase of Common Units
Repurchased 1.77 million common units at an average price of $7.28, along with 25,700 Series E and 33,200 Series I preferred units, totaling 3.8 million common units repurchased at an average price of $7.42.
Negative Updates
Elevated Payout Ratios
Payout ratios were elevated, and income metrics like FFO and AFFO may fluctuate quarter-to-quarter.
Increased Debt to Gross Book Value
Debt to gross book value increased to 41.1% as of June 30, compared to 40.2% at the most recent year-end.
Strategic Review Costs
Incurred strategic review costs in G&A due to ongoing capital allocation explorations.
Company Guidance
During the second quarter of 2025, Artis Real Estate Investment Trust focused on reducing leverage and strengthening its balance sheet, aiming to maximize long-term value for its unitholders. Occupancy levels increased to 87.8%, up from 87.1% in the previous quarter, driven by the commencement of a new 80,600 square foot lease and 210,643 square feet of renewals with rental rates rising by 3.6%. The company closed the sale of a Canadian retail property for $4.8 million and went unconditional on the sale of a 90% interest in U.S. development land for USD 11.3 million. Debt to gross book value was at 41.1% as of June 30, 2025. The net asset value per unit stood at $12.98, reflecting impacts from foreign exchange, distributions, credit loss provisions, and fair value adjustments. Artis repurchased 1.77 million common units at an average price of $7.28 and continued to actively manage upcoming mortgage maturities. The company is exploring strategic options for the Cominar portfolio, with discussions progressing and a resolution expected by year-end.Artis Real Estate Investment Financial Statement Overview
Summary
Artis Real Estate Investment shows a mixed financial position. While operational cash flows are stable and leverage is manageable, persistently negative net income and declining revenue are concerning. The company needs to focus on reversing revenue contraction and improving profitability to enhance its financial health.Income Statement
The income statement shows declining revenue over recent years, with a revenue drop from $458.9M in 2020 to $282.3M in TTM. Gross profit margin for TTM is 53.4%, which is respectable. However, the net profit margin is negative at -10.2% due to consistent net losses, indicating profitability challenges. The EBITDA margin is 25.0%, suggesting moderate operational efficiency, but the overall trend reflects a need for revenue stabilization and cost management.45
Neutral
Balance Sheet
The balance sheet is reasonably strong with a debt-to-equity ratio of 0.68 in TTM, indicating a balanced leverage. However, total assets have decreased from $4.9B in 2020 to $2.7B in TTM. The equity ratio stands at 57.5%, which is healthy and suggests a solid capital structure. Despite asset shrinkage, the company maintains a stable equity position.55
Neutral
Cash Flow
Cash flow analysis reveals a stable operating cash flow with $79.7M in TTM, and free cash flow remains positive. However, there is a significant negative financing cash flow driven by high debt repayments, indicating potential liquidity pressures. The operating cash flow to net income ratio is negative due to net losses, suggesting difficulties translating cash operations into profits.60
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 256.60M | 300.37M | 335.84M | 372.51M | 419.50M | 458.92M |
| Gross Profit | 133.68M | 163.23M | 184.02M | 209.98M | 237.78M | 269.27M |
| EBITDA | 22.82M | 53.88M | -217.19M | 294.89M | 232.92M | 265.09M |
| Net Income | -53.12M | -47.41M | -332.07M | -5.29M | 389.18M | 21.54M |
Balance Sheet | ||||||
| Total Assets | 2.61B | 2.80B | 3.74B | 4.55B | 4.58B | 4.86B |
| Cash, Cash Equivalents and Short-Term Investments | 16.64M | 32.79M | 28.94M | 29.17M | 221.47M | 34.70M |
| Total Debt | 1.08B | 1.13B | 1.91B | 2.21B | 1.97B | 2.40B |
| Total Liabilities | 1.16B | 1.22B | 2.02B | 2.32B | 2.12B | 2.53B |
| Stockholders Equity | 1.46B | 1.58B | 1.72B | 2.23B | 2.46B | 2.33B |
Cash Flow | ||||||
| Free Cash Flow | 79.68M | 79.73M | 79.59M | 140.72M | 202.28M | 176.31M |
| Operating Cash Flow | 79.68M | 80.14M | 79.96M | 140.74M | 202.29M | 176.33M |
| Investing Cash Flow | 548.08M | 652.11M | 298.39M | -288.99M | 607.47M | 165.96M |
| Financing Cash Flow | -636.79M | -730.44M | -378.19M | -46.57M | -622.97M | -350.00M |
Artis Real Estate Investment Technical Analysis
Negative
6.06
Price Trends
7.21
Negative
7.24
Negative
7.17
Negative
Market Momentum
-0.27
Positive
18.59
Positive
7.81
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:AX.UN, the sentiment is Negative. The current price of 6.06 is below the 20-day moving average (MA) of 7.04, below the 50-day MA of 7.21, and below the 200-day MA of 7.17, indicating a bearish trend. The MACD of -0.27 indicates Positive momentum. The RSI at 18.59 is Positive, neither overbought nor oversold. The STOCH value of 7.81 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:AX.UN.
Artis Real Estate Investment Peers Comparison
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | 391.79M | 13.91 | 5.16% | 7.71% | -0.28% | 206.65% | |
76 Outperform | 331.89M | 8.74 | 7.69% | 8.23% | 1.59% | 19.74% | |
69 Neutral | 2.78B | -723.67 | 8.53% | 5.95% | 6.86% | 92.60% | |
55 Neutral | $585.50M | ― | -3.37% | 9.90% | -21.40% | 71.00% | |
55 Neutral | 3.13B | -32.30 | -2.27% | 6.22% | -5.67% | 54.92% | |
48 Neutral | 374.07M | -11.07 | -3.82% | 4.33% | -2.90% | 68.88% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% |
* Real Estate Sector Average
Performance Comparison
TSE:AX.UN
Artis Real Estate Investment
6.06
-1.38
-18.50%
TSE:BTB.UN
BTB REIT
3.76
0.42
12.57%
TSE:CRR.UN
Crombie Real Estate ate
14.98
0.02
0.13%
TSE:HR.UN
H&R Real Estate ate Staple
11.93
1.23
11.50%
TSE:MRT.UN
Morguard Real Estate ate
5.71
0.23
4.20%
TSE:PRV.UN
PRO Real Estate Investment
5.84
0.40
7.35%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.