Education
About Us
Working with TipRanks
Follow Us
H&R Real Estate ate Staple (TSE:HR.UN)
TSX:HR.UN
RESEARCH TOOLSreports
Top Page
H&R Real Estate ate Staple
(TSX:HR.UN)
63Neutral
H&R Real Estate ate Staple (HR.UN) vs. S&P 500 (SPY)
Market Cap
C$2.66B
Dividend Yield5.92%
Average Volume (3M)543.40K
Price to Earnings (P/E)―
Beta (1Y)0.90
Revenue Growth-6.92%
EPS Growth-310.05%
CountryCA
Employees777
SectorReal Estate
Sector Strength63
IndustryREIT - Diversified
Share Statistics
EPS (TTM)-0.49
Shares Outstanding262,565,580
10 Day Avg. Volume627,924
30 Day Avg. Volume543,404
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)3.39
Price to Cash Flow (P/CF)8.40
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$11.50Price Target Upside13.52% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
H&R Real Estate ate Staple Business Overview & Revenue Model
Company DescriptionH&R Real Estate Investment Trust (HR.UN) is one of Canada's largest diversified real estate investment trusts. It is focused on owning, managing, and developing properties across multiple sectors including office, retail, industrial, and residential. The company's portfolio is geographically diversified with significant holdings in key markets across Canada and the United States.
How the Company Makes MoneyH&R Real Estate Investment Trust generates revenue primarily through rental income from its extensive portfolio of properties. This includes leasing space in its office, retail, industrial, and residential properties to a variety of tenants. The company benefits from long-term lease agreements, which provide a stable and predictable cash flow. Additionally, H&R engages in property development and redevelopment projects, which contribute to its earnings through increased property values and potential sales. Partnerships and joint ventures with other real estate companies and investors also play a role in enhancing its revenue streams.
H&R Real Estate ate Staple Financial Statement Overview
Summary
H&R Real Estate Staple is facing significant financial challenges, with declining revenues and profitability, increasing leverage, and operational inefficiencies. While the company maintains stable cash flow generation, the negative trends in income and balance sheet metrics underscore potential risks and the need for strategic adjustments to improve financial health.Income Statement
The income statement shows a concerning trend with decreasing revenue and net income over the years. Gross profit margin has declined from 61.9% in 2019 to 61.1% in 2024, indicating reduced operational efficiency. There is a significant drop in net profit margin, from 29.6% in 2019 to -14.6% in 2024, reflecting increasing losses. The absence of EBIT and negative EBITDA in 2024 highlight ongoing operational challenges.45
Neutral
Balance Sheet
The balance sheet reveals a declining equity base and increasing leverage. The debt-to-equity ratio has worsened from 0.91 in 2019 to 0.67 in 2024, reflecting a cautious improvement in leverage but still indicating high reliance on debt. Return on equity has turned negative, signifying inefficiencies in generating returns for shareholders. The equity ratio has also decreased, suggesting a declining proportion of assets financed by equity.55
Neutral
Cash Flow
The cash flow statement presents a mixed picture. Operating cash flow has been relatively stable, but free cash flow has shown volatility. The free cash flow growth rate was negative from 2023 to 2024, highlighting potential liquidity issues. The operating cash flow to net income ratio indicates the company is generating cash despite net losses, but the free cash flow to net income ratio shows challenges in converting revenue into free cash flow.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 816.99M | 903.63M | 834.64M | 1.07B | 1.10B | Gross Profit |
| 499.34M | 603.09M | 534.95M | 661.58M | 663.67M | EBIT |
| 0.00 | 578.71M | -78.93M | 414.00M | 453.90M | EBITDA |
| -35.07M | 627.04M | 506.68M | 820.29M | 651.82M | Net Income Common Stockholders |
| -119.71M | 61.69M | 844.82M | 597.91M | -624.56M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 100.35M | 64.11M | 76.89M | 124.14M | 62.86M | Total Assets |
| 10.62B | 10.78B | 11.41B | 10.50B | 13.36B | Total Debt |
| 3.54B | 3.72B | 3.95B | 3.92B | 6.40B | Net Debt |
| 3.44B | 3.65B | 3.88B | 3.80B | 6.34B | Total Liabilities |
| 5.34B | 5.59B | 5.93B | 5.73B | 7.28B | Stockholders Equity |
| 5.28B | 5.19B | 5.49B | 4.77B | 6.07B |
| Cash Flow | Free Cash Flow | |||
| 234.48M | 253.46M | 219.47M | 405.02M | 373.95M | Operating Cash Flow |
| 274.07M | 294.63M | 255.05M | 452.11M | 426.93M | Investing Cash Flow |
| 173.15M | 112.86M | 225.95M | 1.50B | -183.24M | Financing Cash Flow |
| -410.98M | -420.26M | -528.26M | -1.89B | -229.47M |
H&R Real Estate ate Staple Technical Analysis
Positive
10.13
Price Trends
9.73
Positive
9.64
Positive
9.64
Positive
Market Momentum
0.08
Positive
56.89
Neutral
57.64
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:HR.UN, the sentiment is Positive. The current price of 10.13 is above the 20-day moving average (MA) of 10.07, above the 50-day MA of 9.73, and above the 200-day MA of 9.64, indicating a bullish trend. The MACD of 0.08 indicates Positive momentum. The RSI at 56.89 is Neutral, neither overbought nor oversold. The STOCH value of 57.64 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:HR.UN.
H&R Real Estate ate Staple Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | C$4.30B | 19.12 | 4.50% | 7.33% | 9.46% | -42.77% | |
74 Outperform | C$4.28B | 11.97 | 6.55% | 4.79% | 9.19% | 166.98% | |
72 Outperform | C$6.92B | 24.66 | 3.20% | 3.43% | 4.45% | ― | |
68 Neutral | $5.08B | 10.98 | 6.34% | 6.68% | 11.62% | 1120.60% | |
63 Neutral | C$2.66B | ― | -2.29% | 5.92% | -6.92% | -310.05% | |
61 Neutral | $4.73B | 18.31 | -3.52% | 11.14% | 5.97% | -21.87% | |
53 Neutral | $2.39B | ― | -5.79% | 11.06% | 4.98% | 19.54% |
* Real Estate Sector Average
Performance Comparison
TSE:HR.UN
H&R Real Estate ate Staple
10.02
1.48
17.33%
TSE:REI.UN
RioCan Real Estate Investment
17.10
-0.28
-1.63%
TSE:AP.UN
Allied Properties Real Estate Investment Trust
16.62
0.62
3.88%
TSE:GRT.UN
Granite Real Estate
67.87
-5.93
-8.04%
TSE:SRU.UN
SmartCentres Real Estate Investment Trust
25.14
3.58
16.60%
TSE:CAR.UN
Canadian Apartment
42.62
-2.41
-5.35%
H&R Real Estate ate Staple Earnings Call Summary
Earnings Call Date: Feb 12, 2025 | % Change Since: 6.07% | Next Earnings Date: May 20, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture. On the positive side, the industrial and multifamily segments showed strong performance, and the company's liquidity and balance sheet remain robust. However, challenges persist in the office segment and Sunbelt market lease trade-outs, coupled with flat FFO growth and difficult market conditions for transactions.Highlights
Strong Industrial Segment Performance
Industrial segment's same property net operating income increased by 6.3%. The portfolio continues to perform well, with significant rent increases from $7.17 to $9.66 per square foot.
Positive Multifamily Sector Trends
In the U.S., multifamily demand remains strong with over 230,000 units absorbed in Q4. Retention was 59%, and rental growth is evident with a notable increase in average U.S. residential rents from $21.16 to $26.84 per square foot.
High Liquidity and Strong Balance Sheet
Liquidity was in excess of $900 million, with an unencumbered property pool of $4.4 billion. Debt to total assets ratio was 43.7%, and debt to EBITDA was at 9.4 times.
High Occupancy Rates
Office occupancy at December 31, 2024, was 96.8%, with a substantial portion of office revenue (87.6%) coming from investment-grade tenants.
Lowlights
Decline in Office Segment Income
Office segment same property net operating income decreased by 2.8% due to market conditions, despite high occupancy rates.
Negative Lease Trade-Outs in Sunbelt
Blended trade-outs for the Sunbelt markets were negative 5.9% in Q4, indicating challenges in rental growth within this region.
Flat FFO Growth
FFO per unit for Q4 2024 was $0.298, compared to $0.299 in Q4 2023, indicating stagnation in funds from operations growth.
Challenging Market for Transactions
The current market conditions are challenging for asset sales, particularly in office and retail sectors, with a wide bid-ask spread.
Company Guidance
During the H&R Real Estate Investment Trust 2024 Fourth Quarter Earnings Conference Call, the guidance provided highlighted key financial metrics and strategic initiatives. The company reported that 70% of its real estate assets by value are now in the United States. The office segment saw a 2.8% decrease in same property net operating income, with occupancy at 96.8% and an average lease term of six years. The residential segment reported a 0.5% increase in net operating income on a cash basis, with U.S. residential rents rising from $21.16 to $26.84 per square foot between June 2021 and December 2024. The retail segment experienced a 5% increase in same property net operating income, while the industrial segment grew by 6.3%. Financially, the REIT maintained a healthy balance sheet with a debt to total assets ratio of 43.7% and liquidity exceeding $900 million. The company also outlined plans for asset sales, including possible dispositions of Echo and [Indiscernible] positions, with proceeds potentially used for deleveraging or share buybacks, depending on the volume of sales.H&R Real Estate ate Staple Corporate Events
DividendsBusiness Operations and Strategy
H&R REIT Announces March 2025 Distribution Amid Strategic Shift
Positive
Mar 17, 2025
H&R Real Estate Investment Trust has declared a monthly distribution of $0.05 per unit for March 2025, with an annualized distribution of $0.60. The distribution is scheduled for April 15, 2025, with a record date of March 31, 2025. This announcement aligns with H&R’s strategic focus on residential and industrial properties, as the company continues to streamline its operations by selling off office and retail properties. This move is part of H&R’s broader strategy to enhance its market position and create long-term value for its stakeholders.
Business Operations and StrategyFinancial Disclosures
H&R REIT Reports Successful Strategic Repositioning
Positive
Feb 12, 2025
H&R REIT announced its financial results for the fourth quarter of 2024, highlighting its successful strategic repositioning towards residential and industrial properties. The company completed the spin-off of its enclosed shopping centers and sold stakes in numerous properties, increasing the residential and industrial segments of its portfolio from 35% to 67%, and boosting its U.S. real estate assets from 44% to 70%. This repositioning underscores H&R’s commitment to simplifying its structure and focusing on growth and income-oriented investments.
H&R REIT Declares January 2025 Distribution Amid Strategic Shift
Jan 17, 2025
H&R Real Estate Investment Trust has declared a monthly distribution for January 2025, with a distribution of $0.05 per unit, annualized at $0.60, payable on February 14, 2025 to unitholders on record as of January 31, 2025. This announcement aligns with H&R’s strategy to enhance value for its stakeholders through a focused approach on residential and industrial properties, reflecting its ongoing efforts to streamline operations and optimize its property portfolio.
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.