RioCan Real Estate Investment (REI.UN) AI Stock Analysis

• Market Cap: $5.20B
• Dividend Yield: 6.55%
• Average Volume (3M): 613.03K
• Price to Earnings (P/E): 20.4
• Beta (1Y): 0.81
• Revenue Growth: 13.66%
• EPS Growth: 426.86%
• Country: CA
• Employees: 496
• Sector: Real Estate
• Sector Strength: 52
• Industry: REIT - Retail
• EPS (TTM): -0.28
• Shares Outstanding: 294,414,340
• 10 Day Avg. Volume: 584,236
• 30 Day Avg. Volume: 613,035
• PEG Ratio: -0.45
• Price to Book (P/B): 0.84
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 57.16
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $19.59
• Price Target Upside: 8.74% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 69 Neutral
• Price Target: C$19.50 ▲(8.21%Upside)

RioCan's strong operational performance and strategic asset dispositions are key strengths, bolstered by stable revenue growth and a solid balance sheet. However, challenges with declining profitability and revised FFO guidance due to external factors like HBC's insolvency impact the overall outlook. The company needs to focus on managing debt levels and sustaining profitability to enhance investor confidence.

Positive Factors

Debt Management

More than 50% of 2025 debt maturities have already been addressed, with significant repayments and attractive refinancing options.

Financial Performance

RioCan generated strong financial performance in Q1/25, driven by healthy operating performance and profits from condo completions.

Retail Fundamentals

Retail fundamentals are strong, and SP-NOI growth profile is expected to improve in 2025.

Negative Factors

Financial Impact

RioCan has significant exposure to Hudson's Bay Co., which is undergoing full liquidation, leading to a negative near-term impact on RioCan's portfolio and cash flow.

Market Sentiment

Concerns surrounding the HBC bankruptcy and a weak condo market continue to weigh on the unit price.

Revenue Challenges

Re-tenanting large spaces from the HBC sites can be both timely and expensive, leading to substantial costs for redevelopment.

RioCan Real Estate Investment Business Overview & Revenue Model

Company Description

RioCan is one of Canada's largest real estate investment trusts. RioCan owns, manages and develops retail-focused, increasingly mixed-use properties located in prime, high-density transit-oriented areas where Canadians want to shop, live and work. As at September 30, 2020, our portfolio is comprised of 221 properties with an aggregate net leasable area of approximately 38.4 million square feet (at RioCan's interest) including office, residential rental and 16 development properties.

How the Company Makes Money

RioCan makes money through the rental income generated from its diverse portfolio of retail and mixed-use properties. The primary revenue stream comes from leasing retail space to a variety of tenants, including national and international retailers, supermarkets, and service providers. Additionally, RioCan generates income from its residential properties through leasing units to tenants, contributing to its revenue diversification efforts. The company also engages in property development, creating new commercial and residential spaces, which can be sold or leased to generate additional revenue. Strategic partnerships with other real estate developers and institutional investors further enhance its financial performance, allowing for shared investment risks and expanded development capabilities.

RioCan Real Estate Investment Financial Statement Overview

Summary

RioCan demonstrates stable revenue growth and strong operational cash flow, yet faces challenges with declining net profitability and free cash flow. The balance sheet is solid with a moderate debt-to-equity ratio, although high debt levels require careful management.

Income Statement

The company demonstrates stable revenue growth, with a 4.9% increase from 2023 to 2024. The gross profit margin for TTM is 59.7%, which is consistent with previous periods, reflecting stable cost management. However, the net profit margin for TTM has decreased significantly to 20.0% from 36.6% in 2024, indicating pressure on net profitability. EBIT and EBITDA margins are relatively strong at 55.4% and 39.7% respectively, but the decline in EBITDA compared to 2024 suggests potential efficiency issues.

Balance Sheet

The balance sheet shows a stable equity base with a debt-to-equity ratio of 1.02, indicating moderate leverage. Return on equity for TTM is 3.6%, which is a decline from previous years, reflecting lower profitability. The equity ratio is 47.8%, suggesting a solid financial structure. However, high debt levels could pose a risk if not managed properly, especially in a rising interest rate environment.

Cash Flow

The company shows a decrease in free cash flow for TTM. Free cash flow to net income ratio is 0.54, indicating that only a portion of net income is being converted into free cash flow. The operating cash flow to net income ratio is higher at 1.40, reflecting strong operational cash generation. Nevertheless, the decline in free cash flow growth rate highlights potential challenges in maintaining liquidity.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.30B	1.29B	1.16B	1.21B	1.18B	1.14B
Gross Profit	778.20M	794.30M	714.41M	700.49M	689.86M	670.09M
EBITDA	516.98M	731.66M	237.02M	674.08M	675.34M	652.50M
Net Income	260.71M	473.46M	38.80M	236.77M	598.39M	-64.78M
Balance Sheet
Total Assets	15.31B	15.47B	14.84B	15.10B	15.18B	15.27B
Cash, Cash Equivalents and Short-Term Investments	59.49M	190.24M	128.44M	86.23M	77.76M	238.46M
Total Debt	7.43B	7.35B	6.90B	6.78B	6.71B	6.97B
Total Liabilities	7.99B	7.91B	7.40B	7.37B	7.27B	7.53B
Stockholders Equity	7.32B	7.56B	7.44B	7.73B	7.91B	7.73B
Cash Flow
Free Cash Flow	140.84M	81.34M	-5.48M	113.15M	26.52M	35.95M
Operating Cash Flow	364.48M	378.28M	385.52M	506.12M	490.40M	552.58M
Investing Cash Flow	-324.30M	-360.77M	-200.15M	-79.69M	94.39M	-469.34M
Financing Cash Flow	-25.36M	48.49M	-147.37M	-417.97M	-745.49M	61.69M

RioCan Real Estate Investment Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 18.02
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:REI.UN, the sentiment is Positive. The current price of 18.02 is above the 20-day moving average (MA) of 17.53, above the 50-day MA of 17.25, and above the 200-day MA of 17.85, indicating a bullish trend. The MACD of 0.14 indicates Negative momentum. The RSI at 69.09 is Neutral, neither overbought nor oversold. The STOCH value of 72.99 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:REI.UN.

RioCan Real Estate Investment Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CRT.UN	82 Outperform	C$3.77B	8.48	11.23%	5.97%	4.54%	68.32%
SRU.UN	78 Outperform	C$4.35B	18.49	4.75%	7.24%	10.06%	-19.26%
PLZ.UN	76 Outperform	C$428.45M	17.35	4.57%	7.16%	6.36%	13.91%
FCR.UN	74 Outperform	C$3.86B	17.96	5.40%	4.88%	3.11%	―
PMZ.UN	73 Outperform	C$1.53B	26.05	2.99%	5.83%	22.60%	-48.92%
REI.UN	69 Neutral	$5.20B	20.40	3.61%	6.55%	13.66%	426.86%
Sector *	65 Neutral	£989.01M	11.77	-0.08%	5.05%	10.32%	31.28%

RioCan Real Estate Investment Corporate Events

RioCan Reports Strong Q1 2025 Results Amid Economic Challenges

RioCan Real Estate Investment Trust reported strong first-quarter results for 2025, with significant leasing spreads and same property NOI growth despite global economic volatility. The company achieved a 96% completion rate for condominium interim closings and is proceeding with the sale of four additional assets as part of its monetization strategy. Despite a net loss per unit due to valuation losses in its joint venture with HBC, RioCan’s financial position remains robust, supported by a strong balance sheet and liquidity. The company has revised its FFO per unit guidance for 2025, maintaining a focus on capital management and growth.