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Nexus Real Estate Investment Trust (TSE:NXR.UN)
TSX:NXR.UN
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Nexus Real Estate Investment
(TSX:NXR.UN)
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Rating:69Neutral
Price Target:
C$8.50
▲(8.14% Upside)
Nexus Real Estate Investment's overall score is driven by strong operational efficiency and positive earnings call sentiment, despite challenges in revenue growth and high leverage. The technical indicators suggest potential for upward momentum, while the high dividend yield offers an attractive income stream. However, the relatively high P/E ratio indicates the stock may be overvalued.
Positive Factors
Operational Efficiency
High gross profit margins indicate efficient cost management, which supports long-term profitability and competitive positioning.
Leasing Activity
Strong leasing activity with significant rent increases enhances revenue stability and reflects robust demand for the company's properties.
Credit Facility Expansion
Expanding the credit facility provides greater financial flexibility for future investments and growth opportunities.
Negative Factors
Revenue Growth Challenges
Negative revenue growth suggests potential difficulties in maintaining top-line expansion, which could impact long-term financial performance.
High Leverage
High leverage can increase financial risk and limit the company's ability to invest in growth or weather economic downturns.
Net Loss
A net loss indicates potential issues in profitability and financial health, affecting investor confidence and future earnings potential.
Nexus Real Estate Investment (NXR.UN) vs. iShares MSCI Canada ETF (EWC)
Market Cap
$744.13M
Dividend Yield8.14%
Average Volume (3M)114.07K
Price to Earnings (P/E)24.7
Beta (1Y)1.15
Revenue Growth4.66%
EPS Growth-82.85%
CountryCA
Employees21
SectorReal Estate
Sector Strength53
IndustryREIT - Industrial
Share Statistics
EPS (TTM)-0.08
Shares Outstanding71,300,590
10 Day Avg. Volume99,262
30 Day Avg. Volume114,066
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 Cap2.64
Enterprise Value/Revenue11.08
Enterprise Value/Gross Profit15.21
Enterprise Value/Ebitda23.59
Forecast
1Y Price Target
$8.15Price Target Upside3.65% Upside
Rating ConsensusHold
Number of Analyst Covering5
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Nexus Real Estate Investment Business Overview & Revenue Model
Company DescriptionNexus Real Estate Investment (NXR.UN) is a Canadian real estate investment trust (REIT) that focuses on acquiring, owning, and managing a diverse portfolio of income-generating properties across various sectors, including industrial, retail, and office spaces. The company aims to provide investors with stable income and long-term capital appreciation through its strategic investments in high-quality real estate assets located in key markets.
How the Company Makes MoneyNexus Real Estate Investment generates revenue primarily through rental income from its portfolio of properties. The company leases its spaces to a variety of tenants, including businesses in retail, industrial, and office sectors. Additionally, NXR.UN may realize income from property management services, as well as potential gains from property sales or refinancing. The REIT benefits from long-term leases with tenants, which provide predictable cash flows. Significant partnerships with real estate developers and local businesses also contribute to its revenue streams, allowing for strategic acquisitions and effective asset management.
Nexus Real Estate Investment Earnings Call Summary
Earnings Call Date:Aug 11, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 13, 2025
Earnings Call Sentiment Positive
The earnings call reflected a positive sentiment with strong leasing activity, progress in development projects, and financial improvements. However, it was tempered by a net loss, leasing challenges, and increased expenses.Q2-2025 Updates
Positive Updates
Net Operating Income Increase
Net operating income increased by 1.7% to $32.2 million compared to a year ago, despite selling 33 properties over the past 12 months.
Strong Leasing Activity
Nearly 400,000 square feet of new leases and renewals were completed, resulting in a rent lift of 38% on renewals.
Successful Lease Backfill
Signed a 15-year lease with a large construction services firm for a 223,000 square foot building in London, Ontario, shortly after it was vacated.
Development Project Progress
Construction of two development properties advanced, with one project expected to deliver an 11% unlevered return on investment.
Financial Metrics Improvement
Normalized FFO increased by 6% to $0.188 per unit and normalized AFFO increased by 7% to $0.159 per unit compared to a year ago.
Credit Facility Upsize
Upsized existing syndicated committed credit facility by $160 million to a total of $785 million, extending its expiry.
Negative Updates
Net Loss Incurred
Posted a net loss of $7.6 million, a significant decrease from a net income of $43.5 million last year, primarily due to lower fair value adjustments.
Challenges in Leasing Out Peavey Mart Building
The building in Red Deer, Alberta, vacated by Peavey Mart, remains unleased, reflecting challenges in finding a specific user for the large space.
Market Slowdown in Hamilton
The leasing market in Hamilton has been slow, impacting the ability to lease a new 115,000 square foot building completed last summer.
Increased General and Administrative Expenses
Total general and administrative expenses for the quarter were $2.2 million, $300,000 higher than a year ago, primarily due to higher compensation expense.
Company Guidance
During the Nexus Industrial REIT's Second Quarter 2025 Results Conference Call, the company reported a net operating income increase of 1.7% to $32.2 million compared to the previous year, despite selling 33 properties in the office, retail, and non-core industrial sectors. Key growth drivers included strong leasing activity, which saw nearly 400,000 square feet of new leases and renewals with a 38% rent lift, as well as significant developments and property acquisitions. The REIT completed construction on two projects, with one yielding an 11% unlevered return and another transitioning to a 9% yield on a $55 million development cost. Notably, the REIT's normalized FFO increased by 6% to $0.188 per unit, and AFFO rose by 7% to $0.159 per unit. Additionally, Nexus expanded its credit facility by $160 million, extending its total to $785 million. Despite a net loss of $7.6 million due to fair value adjustments, the REIT remains focused on its strategy as a Canada-focused industrial REIT.Nexus Real Estate Investment Financial Statement Overview
Summary
Nexus Real Estate Investment shows strong financial performance with consistent revenue growth, solid profitability margins, and efficient cash flow management. Despite increased leverage, the company's financial health remains stable, with a focus on maintaining a strong cash position and effective capital allocation. The fluctuations in net income and ROE suggest potential areas for improved financial stability.Income Statement
Nexus Real Estate Investment has demonstrated robust revenue growth from 2019 to 2024, with a notable increase in total revenue from $60 million in 2019 to $175.7 million in 2024. The Gross Profit Margin improved significantly from 63.2% in 2019 to 71.6% in 2024. However, the Net Profit Margin fluctuated, peaking in 2021 due to a substantial net income but declining in subsequent years. EBITDA Margin remains strong, reflecting efficient operational performance.72
Positive
Balance Sheet
The company's Debt-to-Equity Ratio increased from 1.14 in 2019 to 1.18 in 2024, indicating higher leverage but manageable within the industry norms. Return on Equity (ROE) showed volatility, with a high of 21.7% in 2021, reflecting exceptional net income, followed by a decrease in subsequent years. The Equity Ratio declined slightly over the years, suggesting an increase in liabilities relative to total assets.65
Positive
Cash Flow
Operating Cash Flow remains strong, although it decreased from $51 million in 2023 to $38.96 million in 2024. Free Cash Flow was positive and stable, despite a slight decline from the previous year. The Free Cash Flow to Net Income Ratio was robust, highlighting the company's ability to convert net income into free cash flow effectively.68
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 176.97M | 175.70M | 157.65M | 137.12M | 83.56M | 61.39M |
| Gross Profit | 128.95M | 125.87M | 111.97M | 95.81M | 55.95M | 39.23M |
| EBITDA | 83.14M | 145.87M | 201.67M | 142.37M | -14.93M | 41.62M |
| Net Income | 29.21M | 90.88M | 160.03M | 91.75M | 146.36M | 14.84M |
Balance Sheet | ||||||
| Total Assets | 2.58B | 2.60B | 2.46B | 1.97B | 1.66B | 710.50M |
| Cash, Cash Equivalents and Short-Term Investments | 5.64M | 11.53M | 5.92M | 11.53M | 82.28M | 13.99M |
| Total Debt | 1.26B | 1.25B | 1.19B | 827.11M | 679.55M | 342.72M |
| Total Liabilities | 1.51B | 1.54B | 1.46B | 1.09B | 968.67M | 410.92M |
| Stockholders Equity | 1.07B | 1.06B | 1.00B | 872.54M | 689.48M | 299.58M |
Cash Flow | ||||||
| Free Cash Flow | 9.60M | 24.70M | 32.08M | 30.32M | 19.62M | 18.69M |
| Operating Cash Flow | 27.54M | 38.96M | 51.02M | 41.53M | 25.00M | 24.35M |
| Investing Cash Flow | 17.83M | -78.60M | -345.99M | -315.73M | -469.25M | -45.07M |
| Financing Cash Flow | -47.60M | 45.26M | 289.36M | 203.45M | 512.54M | 26.84M |
Nexus Real Estate Investment Technical Analysis
Negative
7.86
Price Trends
7.76
Negative
7.64
Positive
7.19
Positive
Market Momentum
<0.01
Positive
42.46
Neutral
22.72
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:NXR.UN, the sentiment is Negative. The current price of 7.86 is below the 20-day moving average (MA) of 7.86, above the 50-day MA of 7.76, and above the 200-day MA of 7.19, indicating a neutral trend. The MACD of <0.01 indicates Positive momentum. The RSI at 42.46 is Neutral, neither overbought nor oversold. The STOCH value of 22.72 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:NXR.UN.
Nexus Real Estate Investment Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | C$486.85M | 7.04 | 5.89% | 3.94% | -0.69% | ― | |
69 Neutral | $744.13M | 24.74 | 2.47% | 8.14% | 4.66% | -82.85% | |
68 Neutral | C$898.29M | 7.40 | 6.37% | 4.42% | 3.83% | 63.32% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
49 Neutral | $581.64M | ― | -3.37% | 9.85% | -21.40% | 71.00% | |
45 Neutral | C$244.02M | -1.09 | -43.99% | 289.71% | -20.65% | -629.60% |
* Real Estate Sector Average
TSE:NXR.UN
Nexus Real Estate Investment
7.86
0.25
3.30%
TSE:ERE.UN
European Residential Real Estate ate Investment Trust
1.07
0.34
46.58%
TSE:MRG.UN
Morguard NA REIT UN
17.20
<0.01
0.06%
TSE:AX.UN
Artis Real Estate Investment
6.09
-1.21
-16.52%
TSE:MI.UN
Minto Apartment Real Estate Investment Trust
13.19
-0.28
-2.08%
TSE:MHC.UN
Flagship Communities REIT Investment Trust
25.40
6.04
31.21%
Nexus Real Estate Investment Corporate Events
Nexus REIT’s Earnings Call: Mixed Yet Optimistic Outlook
Sep 1, 2025
The recent earnings call for Nexus Real Estate Investment Trust reflected a generally positive sentiment, highlighting strong leasing activity, progress in development projects, and financial improvements. However, this optimism was tempered by a net loss, leasing challenges, and increased expenses, indicating a mixed but forward-looking outlook for the company.
Nexus Industrial REIT Reports Strong Q2 2025 Results
Aug 13, 2025
Nexus Industrial REIT is a Canadian real estate investment trust focused on acquiring and managing industrial properties in primary and secondary markets across Canada. The company has recently transitioned to a pure-play industrial REIT, emphasizing its commitment to the industrial real estate sector.
Business Operations and StrategyFinancial Disclosures
Nexus Industrial REIT Reports Strong Q2 2025 Results Amid Strategic Shift
Positive
Aug 11, 2025
Nexus Industrial REIT reported strong financial results for the second quarter of 2025, marking its first quarter as a pure-play industrial REIT. The company achieved a 5.6% growth in normalized FFO per unit and a 2.8% increase in industrial SPNOI. It completed the sale of 33 non-core properties and advanced construction projects that are expected to add significant annual NOI. Despite a net loss due to fair value adjustments, the REIT’s strategic focus on industrial properties is expected to yield positive outcomes for stakeholders.
The most recent analyst rating on ($TSE:NXR.UN) stock is a Hold with a C$6.75 price target. To see the full list of analyst forecasts on Nexus Real Estate Investment stock, see the TSE:NXR.UN Stock Forecast page.
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.