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Boardwalk REIT (TSE:BEI.UN)
TSX:BEI.UN

Boardwalk REIT (BEI.UN) AI Stock Analysis

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Boardwalk REIT

(TSX:BEI.UN)

Rating:75Outperform
Price Target:
C$78.00
▲(11.22%Upside)
Boardwalk REIT's overall stock score is driven by strong financial performance and optimistic earnings guidance, supported by positive technical indicators and reasonable valuation. Strategic corporate events further enhance its position. The main risk factors are profit margin fluctuations and market competition.
Positive Factors
Capital Management
BEI has agreed to sell three properties in Edmonton for $80M, which may offer greater financial flexibility.
Financial Performance
BEI's FFO growth has outperformed Canadian multifamily peers over the past two-plus years, demonstrating strong financial performance.
Occupancy Improvement
Pricing adjustments have led to a +40bps occupancy increase, putting BEI in a strong position for the leasing season.
Negative Factors
Debt and Refinancing
Net debt increased by $54M to $3.4B, and refinancing will likely remain a headwind due to market rates.
Market Competition
Increased competition from new housing units in Calgary and Edmonton could impact Boardwalk's legacy properties.
Revenue Growth Concerns
Demand is slowing during a period of elevated supply, raising concerns about sequential revenue growth decelerating more quickly than anticipated.

Boardwalk REIT (BEI.UN) vs. iShares MSCI Canada ETF (EWC)

Boardwalk REIT Business Overview & Revenue Model

Company DescriptionBoardwalk REIT (BEI.UN) is a leading real estate investment trust in Canada, specializing in the acquisition, development, and management of residential multi-family communities. The company primarily operates in the residential real estate sector, offering a portfolio of high-quality rental properties across key urban markets. Boardwalk REIT is committed to providing affordable and comfortable living spaces for its residents while enhancing the value of its properties for stakeholders.
How the Company Makes MoneyBoardwalk REIT primarily generates revenue through rental income from its portfolio of multi-family residential properties. The company leases apartments and residential units to tenants and collects monthly rent payments. This rental income is the core revenue stream for Boardwalk REIT. Additionally, the company may engage in property development and sales activities, contributing to its earnings. Operational efficiencies, strategic property acquisitions, and maintaining high occupancy rates are crucial factors that enhance Boardwalk REIT's profitability. The trust may also benefit from partnerships or joint ventures in the real estate sector, although specific details of such partnerships are not disclosed.

Boardwalk REIT Earnings Call Summary

Earnings Call Date:May 06, 2025
(Q1-2025)
|
% Change Since: 8.40%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Positive
The call highlights strong financial performance with increased rental revenue, high occupancy rates, and strategic capital allocation. However, challenges such as increased vacancy loss and negative leasing spreads in Calgary were noted. Overall, while the company faces some market challenges, its financial position and strategic initiatives remain robust.
Q1-2025 Updates
Positive Updates
Increase in Rental Revenue and NOI
Same-property rental revenue increased by 7.5% and same-property net operating income (NOI) increased by 10.3% compared to the same quarter last year.
High Occupancy Rates
Strong portfolio occupancy at 98% with high demand for affordable rental housing.
Strategic Capital Allocation
Investment of approximately $352,000 into value-add projects and successful acquisitions and dispositions totaling $210 million of real estate transactions.
Increased Distribution
Confirmed next three regular monthly distributions equating to $1.62 per trust unit on an annualized basis, representing a 12.5% increase from the prior year.
Strong Financial Position
The trust maintains approximately $27 million in cash and an undrawn $246 million operating line, providing a flexible financial position.
Negative Updates
Increased Vacancy Loss
Vacancy loss increased although incentives were reduced, impacting the financial performance.
Negative Leasing Spreads in Calgary
New lease spreads in Calgary are slightly negative as the company prioritizes occupancy in more competitive, higher-priced markets.
Challenges with New Supply
Increased competition and vacancy, particularly for higher-priced products, due to new supply entering select markets.
Company Guidance
During the Boardwalk Real Estate Investment Trust's First Quarter 2025 earnings call, the company provided several key metrics indicating strong financial performance and an optimistic outlook for the year. Same-property rental revenue increased by 7.5%, while the same-property net operating income rose by 10.3%. The operating margin improved by 160 basis points, and the same-property funds from operations per unit grew by 11.1%. Occupancy remained high at 98%, with renewal spreads at 5.3% in April 2025 for Alberta. The company also revised its 2025 guidance, forecasting same-property NOI growth between 5.5% and 8.5%, and FFO per unit between $4.35 and $4.60. Additionally, Boardwalk has maintained a strong balance sheet with $273 million in liquidity. Despite a balanced rental market due to new supply, the company continues to emphasize the demand for its affordable, high-quality housing.

Boardwalk REIT Financial Statement Overview

Summary
Boardwalk REIT demonstrates solid financial health with strong revenue growth, efficient operations, and a stable balance sheet. While profitability has seen some fluctuations, the company remains well-positioned with strong cash flow generation and moderate leverage. Continued focus on managing debt levels and improving cash flow growth could bolster its financial standing further.
Income Statement
72
Positive
The income statement indicates a healthy revenue growth trajectory with a significant increase in total revenue over the years. The TTM data shows a Gross Profit Margin of 63.35% and an EBIT Margin of 47.74%, demonstrating strong operational efficiency. However, the Net Profit Margin has decreased to 67.50% from the previous year, suggesting a decline in profitability. Despite this, the company maintains robust EBITDA margins of 75.07%, indicating strong cash-generating capabilities.
Balance Sheet
68
Positive
The balance sheet reflects a stable financial position with a Debt-to-Equity Ratio of 0.68, which is relatively moderate for a REIT. The Equity Ratio stands at 56.68%, indicating a solid equity base. Return on Equity (ROE) is high at 8.41%, highlighting effective utilization of equity. However, the increase in total debt over time could pose leverage-related risks if not managed properly.
Cash Flow
70
Positive
Cash flow analysis reveals a strong Operating Cash Flow to Net Income Ratio of 0.56 and a Free Cash Flow to Net Income Ratio of 0.29, indicating good conversion of profit into cash flow. The Free Cash Flow Growth Rate stands at 9.77%, which is positive but could be improved further to ensure better cash availability for investments and debt servicing.
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
613.75M603.29M545.66M494.81M470.53M465.57M
Gross Profit
388.77M382.33M332.99M288.66M274.34M269.14M
EBIT
292.97M323.85M282.80M260.14M122.98M268.31M
EBITDA
460.82M361.23M282.80M267.92M130.79M231.87M
Net Income Common Stockholders
414.25M588.22M666.10M283.10M446.27M-197.28M
Balance SheetCash, Cash Equivalents and Short-Term Investments
27.02M122.41M331.20M52.82M64.30M52.96M
Total Assets
8.69B8.63B8.14B7.07B6.66B6.11B
Total Debt
3.35B3.65B3.40B3.29B3.08B3.00B
Net Debt
3.32B3.52B3.06B3.24B3.02B2.95B
Total Liabilities
3.76B3.79B3.82B3.60B3.41B3.23B
Stockholders Equity
4.92B4.84B4.32B3.47B3.25B2.88B
Cash FlowFree Cash Flow
118.30M107.77M73.82M31.55M34.86M136.12M
Operating Cash Flow
232.06M241.20M199.80M160.90M161.86M141.08M
Investing Cash Flow
-234.19M-351.63M-154.83M-197.06M-137.88M-217.04M
Financing Cash Flow
-153.62M-98.37M233.43M24.67M-12.64M93.75M

Boardwalk REIT Technical Analysis

Technical Analysis Sentiment
Positive
Last Price70.13
Price Trends
50DMA
65.30
Positive
100DMA
64.42
Positive
200DMA
69.67
Positive
Market Momentum
MACD
1.47
Negative
RSI
65.54
Neutral
STOCH
89.32
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:BEI.UN, the sentiment is Positive. The current price of 70.13 is above the 20-day moving average (MA) of 67.40, above the 50-day MA of 65.30, and above the 200-day MA of 69.67, indicating a bullish trend. The MACD of 1.47 indicates Negative momentum. The RSI at 65.54 is Neutral, neither overbought nor oversold. The STOCH value of 89.32 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:BEI.UN.

Boardwalk REIT Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
81
Outperform
C$2.33B3.6722.26%3.65%5.77%108.23%
TSMEQ
77
Outperform
C$1.78B7.2215.90%0.07%16.22%39.56%
76
Outperform
C$7.09B63.291.29%3.38%0.93%
75
Outperform
$3.73B8.458.71%2.04%9.53%-46.06%
71
Outperform
C$545.60M5.999.03%3.53%-0.29%
71
Outperform
C$1.92B-7.00%2.83%2.52%-573.45%
61
Neutral
$2.82B10.890.42%8438.96%5.74%-20.95%
* Real Estate Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:BEI.UN
Boardwalk REIT
70.13
1.58
2.30%
TSE:KMP.UN
Killam Apartment REIT Un
19.45
2.71
16.19%
TSE:MEQ
Mainstreet Equity
190.02
18.84
11.01%
TSE:CAR.UN
Canadian Apartment
44.36
1.69
3.96%
TSE:IIP.UN
InterRent REIT Un
13.60
2.00
17.24%
TSE:MI.UN
Minto Apartment Real Estate Investment Trust
14.36
-0.48
-3.23%

Boardwalk REIT Corporate Events

Stock BuybackBusiness Operations and StrategyFinancial Disclosures
Boardwalk REIT Reports Robust Q1 2025 Results Amid Strong Demand for Affordable Housing
Positive
May 6, 2025

Boardwalk REIT reported strong financial results for Q1 2025, with an 11.6% increase in Funds From Operations per unit and a 10.3% rise in Net Operating Income compared to the previous year. The company maintained a high occupancy rate and continued to invest in property improvements, enhancing portfolio quality. Strategic capital allocation included the acquisition of new properties and repurchase of trust units, while maintaining a strong balance sheet with significant liquidity. The company’s focus on affordable housing remains a key driver of demand, particularly in its largest market of Edmonton, which benefits from economic diversification and an influx of young workers.

Shareholder MeetingsBusiness Operations and Strategy
Boardwalk REIT Reports Strong Support in 2025 Unitholder Meeting
Positive
May 6, 2025

Boardwalk REIT announced the results of its 2025 annual meeting of unitholders, where all trustee nominees were elected, and Deloitte LLP was reappointed as auditor. The meeting saw a high level of participation with 84.84% of outstanding units represented. The resolutions, including the acceptance of the executive compensation approach, were passed with significant majorities, indicating strong support for the current management and strategic direction. This outcome reinforces Boardwalk’s stable governance and commitment to delivering value to its stakeholders.

M&A TransactionsBusiness Operations and Strategy
Boardwalk REIT Expands Portfolio with Strategic Acquisition
Positive
Apr 3, 2025

Boardwalk REIT has announced the successful acquisition of Elbow 5 Eight, a 255-suite residential community in Calgary, for $93 million. This acquisition is expected to enhance the company’s portfolio by adding a modern, well-located property, potentially increasing value for stakeholders. The company also reported strong occupancy rates and rising rents, indicating robust demand for affordable housing. Boardwalk REIT will release its first-quarter financial results on May 6, 2025, with a teleconference scheduled for the following day to discuss these results.

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.