Education
About Us
Working with TipRanks
Follow Us
Granite Real Estate (TSE:GRT.UN)
TSX:GRT.UN
Top Page
Granite Real Estate
(TSX:GRT.UN)
Select Model
Select Model
Rating:76Outperform
Price Target:
C$89.00
â–²(13.16% Upside)
Granite Real Estate's strong financial performance and bullish technical indicators are the primary drivers of the stock's score. The valuation is also favorable, with a reasonable P/E ratio and attractive dividend yield. However, the overbought technical indicators suggest caution for short-term investors.
Positive Factors
Cash Flow Efficiency
Efficient cash flow conversion ensures Granite can meet its obligations, reinvest in growth opportunities, and provide returns to shareholders.
Profitability Margins
High profitability margins indicate efficient operations and strong pricing power, contributing to sustained earnings and financial stability.
Revenue Growth
Consistent revenue growth reflects Granite's ability to maintain and expand its tenant base, ensuring stable cash flows and supporting long-term financial health.
Negative Factors
Net Profit Margin Pressure
Decreasing net profit margins could signal rising costs or pricing pressures, potentially impacting Granite's future earnings and financial performance.
Return on Equity
Low ROE indicates potential inefficiencies in utilizing shareholders' equity, which could affect investor confidence and long-term profitability.
Free Cash Flow Decline
A decline in free cash flow growth may hinder Granite's ability to fund new investments or return capital to shareholders, impacting long-term growth prospects.
Granite Real Estate (GRT.UN) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$4.77B
Dividend Yield4.29%
Average Volume (3M)92.44K
Price to Earnings (P/E)14.2
Beta (1Y)0.96
Revenue Growth9.87%
EPS Growth48.25%
CountryCA
Employees70
SectorReal Estate
Sector Strength53
IndustryREIT - Industrial
Share Statistics
EPS (TTM)1.55
Shares Outstanding60,591,515
10 Day Avg. Volume98,289
30 Day Avg. Volume92,444
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 CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$86.67Price Target Upside10.20% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
Granite Real Estate Business Overview & Revenue Model
Company DescriptionGranite is a Canadian-based REIT engaged in the acquisition, development, ownership and management of logistics, warehouse and industrial properties in North America and Europe. Granite owns 108 investment properties representing approximately 45.3 million square feet of leasable area.
How the Company Makes MoneyGranite Real Estate makes money by leasing its industrial and logistics properties to a variety of tenants, generating stable rental income. The company employs long-term lease agreements with creditworthy tenants to ensure consistent cash flow. Additionally, Granite seeks to enhance its revenue by actively managing and expanding its property portfolio through strategic acquisitions and developments. This approach not only increases rental income but also enhances property values over time. Key revenue streams include rental income, property management fees, and potential gains from property sales or revaluations. The company's earnings are further supported by the strategic location of its properties, which attracts high-demand tenants in sectors such as e-commerce and automotive, contributing to high occupancy rates and rental growth.
Granite Real Estate Earnings Call Summary
Earnings Call Date:Aug 06, 2025
(Q3-2024)
| % Change Since: |
Next Earnings Date:Nov 05, 2025
Earnings Call Sentiment Positive
The earnings call presented a generally positive performance with strong NOI growth, increased FFO and AFFO, successful leasing and expansions, and significant ESG achievements. However, challenges such as increased G&A expenses, occupancy declines, tenant bankruptcy, and potential economic policy impacts were also highlighted.Q3-2024 Updates
Positive Updates
Strong NOI Growth
Granite posted results ahead of Q2 and in line with annual forecast, largely driven by strong NOI growth. Same-property NOI increased 6.2% on a constant currency basis and 8% with foreign currency effects.
Increase in FFO and AFFO
FFO per unit in Q3 was $1.35, a 2.3% increase from Q2 and an 8.9% increase relative to the same quarter last year. AFFO per unit increased by $0.05 relative to Q2 and $0.13 relative to the same quarter last year.
Successful Leasing and Developments
Achieved an average rental rate increase of 55% over expiring rents. Completed expansions in Ajax, Ontario, and the Netherlands with strong leasing spreads.
ESG Achievements
Ranked #1 by GRESB among North American industrial REITs. Solar PV systems capacity reached over 45 megawatts, with 44% of properties achieving green building certification.
Refinancing Success
Completed $800 million of bond offerings, extending the weighted average debt term to maturity to 4.6 years and maintaining a stable interest expense outlook.
Negative Updates
Increased G&A Expenses
G&A for the quarter was $13.2 million, $5.5 million higher than Q2, mainly due to $5.6 million of unfavorable fair value variance in non-cash compensation liabilities.
Occupancy Challenges
Occupancy slightly declined by 20 bps to 94.5% in Q3. Expected year-end occupancy revised to closer to 95%, down from an earlier forecast of 96% to 97%.
Chapter 11 Filing by Tenant
True Value Company, a tenant, filed for Chapter 11 proceedings. Although they remain current on rent, the outcome is uncertain.
Potential Impact from U.S. Economic Policies
Uncertainty surrounding U.S. economic policies, particularly related to tariffs, may affect future demand and tenant decisions.
Company Guidance
In the Q3 2024 earnings call for Granite REIT, the company provided guidance indicating a promising financial trajectory with several key metrics highlighted. The Funds from Operations (FFO) per unit for the quarter was reported at $1.35, a 2.3% increase from Q2, and an 8.9% increase from the previous year, aligning with the annual guidance. The Adjusted Funds from Operations (AFFO) per unit increased to $1.22, up $0.05 from Q2 and $0.13 from the same quarter last year. The Net Operating Income (NOI) showed robust growth due to favorable leasing spreads and expansion projects, although slightly offset by new vacancies. Same-property NOI grew by 6.2% on a constant currency basis, with an 8% increase when foreign currency effects were considered. The guidance for 2024 was updated, maintaining the FFO per unit range between $5.30 to $5.40, while the AFFO per unit forecast was revised to $4.65 to $4.75 due to reduced capital expenditure estimates. The company's balance sheet remained strong with total assets of $9.3 million and a weighted average cap rate of 5.3% on in-place NOI. Granite's liquidity was bolstered to approximately $1.4 billion, with no borrowings under its credit facility. Overall, Granite REIT's strategic refinancing and leasing activities underscore a stable outlook with anticipated continued growth in NOI and cash flow for 2024.Granite Real Estate Financial Statement Overview
Summary
Granite Real Estate exhibits a strong financial position with consistent revenue growth and robust profitability margins. The balance sheet reflects a stable leverage position, though there is room for improvement in return metrics. Cash flow generation remains efficient, despite a recent decline in free cash flow growth.Income Statement
Granite Real Estate has demonstrated consistent revenue growth with a TTM growth rate of 1.54%, indicating a stable upward trajectory. The company maintains strong profitability margins, with a gross profit margin of 82.47% and a net profit margin of 56.27% in the TTM period. However, the net profit margin has decreased from the previous year, suggesting some pressure on net income. Overall, the income statement reflects a robust financial performance with room for improvement in net profitability.78
Positive
Balance Sheet
The balance sheet shows a moderate debt-to-equity ratio of 0.60, indicating a balanced leverage position. The return on equity (ROE) is relatively low at 6.01% in the TTM period, suggesting limited efficiency in generating profits from equity. The equity ratio stands at 56.95%, reflecting a strong equity base relative to total assets. While the company maintains a stable financial structure, there is potential to enhance profitability and return metrics.72
Positive
Cash Flow
Granite Real Estate's cash flow statement reveals a slight decline in free cash flow growth by -1.09% in the TTM period, indicating some challenges in cash generation. The operating cash flow to net income ratio is strong at 2.41, suggesting efficient cash conversion. The free cash flow to net income ratio is nearly 1, reflecting effective cash management. Despite the decline in free cash flow growth, the company maintains solid cash flow metrics overall.70
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 593.87M | 569.14M | 521.25M | 455.58M | 393.49M | 340.20M |
| Gross Profit | 489.75M | 471.99M | 435.24M | 380.36M | 332.68M | 293.04M |
| EBITDA | 456.33M | 480.48M | 203.14M | 346.73M | 293.51M | 260.98M |
| Net Income | 334.19M | 360.61M | 136.66M | 155.77M | 1.31B | 429.80M |
Balance Sheet | ||||||
| Total Assets | 9.47B | 9.62B | 9.07B | 9.28B | 8.57B | 6.75B |
| Cash, Cash Equivalents and Short-Term Investments | 86.42M | 126.17M | 116.13M | 135.08M | 402.51M | 831.28M |
| Total Debt | 3.21B | 3.11B | 3.10B | 3.07B | 2.46B | 2.21B |
| Total Liabilities | 4.07B | 3.88B | 3.78B | 3.80B | 3.25B | 2.83B |
| Stockholders Equity | 5.39B | 5.73B | 5.28B | 5.48B | 5.32B | 3.92B |
Cash Flow | ||||||
| Free Cash Flow | 359.52M | 338.48M | 312.90M | 276.69M | 261.68M | 179.03M |
| Operating Cash Flow | 359.64M | 338.61M | 313.18M | 277.50M | 262.26M | 244.32M |
| Investing Cash Flow | -97.25M | -65.46M | -128.13M | -766.56M | -1.03B | -1.07B |
| Financing Cash Flow | -278.45M | -267.50M | -203.11M | 214.56M | 333.48M | 1.36B |
Granite Real Estate Technical Analysis
Positive
78.65
Price Trends
75.99
Positive
71.68
Positive
68.80
Positive
Market Momentum
0.21
Positive
57.09
Neutral
32.86
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:GRT.UN, the sentiment is Positive. The current price of 78.65 is above the 20-day moving average (MA) of 77.83, above the 50-day MA of 75.99, and above the 200-day MA of 68.80, indicating a bullish trend. The MACD of 0.21 indicates Positive momentum. The RSI at 57.09 is Neutral, neither overbought nor oversold. The STOCH value of 32.86 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:GRT.UN.
Granite Real Estate Peers Comparison
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | 3.89B | 8.87 | 16.70% | 5.90% | 4.26% | 72.02% | |
76 Outperform | C$4.77B | 14.23 | 6.18% | 4.29% | 9.87% | 48.25% | |
76 Outperform | 3.56B | 16.71 | 4.55% | 5.61% | 7.23% | 20.37% | |
73 Outperform | 4.11B | 15.84 | 6.53% | 4.69% | 2.53% | 0.00% | |
72 Outperform | 4.55B | 20.71 | 4.43% | 6.93% | 7.01% | -15.80% | |
69 Neutral | 2.78B | -723.19 | 8.53% | 5.95% | 6.86% | 92.60% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% |
* Real Estate Sector Average
Performance Comparison
TSE:GRT.UN
Granite Real Estate
77.56
0.54
0.70%
TSE:CRR.UN
Crombie Real Estate ate
14.97
0.08
0.54%
TSE:CRT.UN
CT Real Estate Investment
16.14
0.92
6.04%
TSE:DIR.UN
Dream Industrl REIT
12.47
-1.20
-8.78%
TSE:FCR.UN
First Capital Realty
19.37
1.42
7.91%
TSE:SRU.UN
SmartCentres Real Estate Investment Trust
26.68
1.72
6.89%
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.