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Slate Grocery REIT (TSE:SGR.UN)
TSX:SGR.UN
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Slate Grocery REIT
(TSX:SGR.UN)
Rating:80Outperform
Price Target:
C$16.50
▲(13.95%Upside)
Slate Grocery REIT (SGR.UN) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$869.36M
Dividend Yield0.58%
Average Volume (3M)77.61K
Price to Earnings (P/E)15.5
Beta (1Y)1.00
Revenue Growth3.90%
EPS Growth8.72%
CountryCA
EmployeesN/A
SectorReal Estate
Sector Strength59
IndustryREIT - Retail
Share Statistics
EPS (TTM)0.30
Shares Outstanding59,009,000
10 Day Avg. Volume71,128
30 Day Avg. Volume77,610
Financial Highlights & Ratios
PEG Ratio0.12
Price to Book (P/B)0.91
Price to Sales (P/S)0.00
P/FCF Ratio12.95
Enterprise Value/Market Cap2.05
Enterprise Value/Revenue2.14
Enterprise Value/Gross Profit12.90
Enterprise Value/Ebitda7.68
Forecast
1Y Price Target
C$13.60Price Target Upside-6.08% Downside
Rating ConsensusHold
Number of Analyst Covering1
Slate Grocery REIT Business Overview & Revenue Model
Company DescriptionSlate Grocery REIT (SGR.UN) is a real estate investment trust that focuses on acquiring, owning, and managing grocery-anchored real estate properties across the United States. The company's portfolio primarily consists of properties leased to grocery stores, offering essential services that ensure consistent consumer demand. Slate Grocery REIT is committed to providing stable and growing distributions to its investors through strategic acquisitions and active management of its property assets.
How the Company Makes MoneySlate Grocery REIT makes money primarily through leasing its properties to tenants, with a significant focus on grocery-anchored real estate. The majority of their revenue comes from rental income generated by long-term leases with grocery stores and other essential service retailers that are typically less sensitive to economic cycles. Additionally, the company may benefit from property appreciation and strategic sales of assets within its portfolio. Slate Grocery REIT's earnings are supported by its focus on properties that provide stable cash flows through essential retail services, enhanced by potential partnerships with large national grocery chains and continued expansion in high-demand markets.
Slate Grocery REIT Earnings Call Summary
Earnings Call Date:May 05, 2025
(Q1-2025)
| % Change Since: 3.28%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Positive
The earnings call for Slate Grocery REIT's Q1 2025 was predominantly positive, with significant achievements in leasing volumes, rental spreads, and net operating income growth. The REIT's stable occupancy and proactive debt management further bolster its position. Although there was a temporary setback due to a tenant bankruptcy, it is viewed as an opportunity to capture higher market rents. Overall, the favorable market conditions and strategic management decisions outweigh the minor challenges faced.Q1-2025 Updates
Positive Updates
Record Leasing Volumes and Rental Spreads
Slate Grocery REIT completed over 220,000 square feet of total leasing in Q1 2025, with renewal spreads reaching a record high of 17% above expiring rents and new deals completed at over 22% above comparable average in-place rents.
Increase in Net Operating Income
Adjusting for completed redevelopments, same-property net operating income increased by $6.8 million or 4.3% on a trailing 12-month basis.
Stable Portfolio Occupancy
Portfolio occupancy remained stable at 94.4%, with average in-place rent at $12.72 per square foot, significantly below the market average of $23.85 per square foot.
Debt Management
Slate Grocery REIT has only $179 million of debt maturing in 2025, representing less than 13% of the total debt. Post-quarter end, $17 million of debt was financed at attractive terms, with positive discussions underway for the remaining 2025 debt maturities.
Favorable Market Conditions
High construction costs and tight lending conditions limit new retail development, reinforcing the value of existing centers and providing a favorable environment for rent increases.
Negative Updates
Mid-Valley Mall Bankruptcy Impact
Occupancy dipped due to a bankruptcy at Mid-Valley Mall, where a tenant, Big Lots, vacated. However, this provides an opportunity to re-lease the space at higher market rents.
Company Guidance
During the Slate Grocery REIT Q1 2025 conference call, the management provided optimistic guidance, highlighting robust leasing performance with double-digit rental spreads contributing to a 4.3% increase in same-property net operating income, equivalent to $6.8 million on a trailing 12-month basis. Leasing activity was strong, with over 220,000 square feet completed, and renewal spreads achieved a record high of 17% above expiring rents, while new deals were 22% above comparable in-place rents. Portfolio occupancy was stable at 94.4%, and the average rent of $12.72 per square foot remains significantly below the market average of $23.85, indicating potential for further rent increases. The REIT has only $179 million of debt maturing in 2025, constituting less than 13% of total debt, and productive refinancing discussions are underway. The management expressed confidence in the grocery-anchored sector's resilience amidst economic uncertainties, citing limited new retail development and high construction costs as factors bolstering the value of existing well-located centers. They also noted that recent tenant bankruptcies are creating opportunities to mark spaces to market, potentially yielding higher rents. Overall, the management remains positive about the REIT's growth prospects and its ability to generate long-term value for unitholders.Slate Grocery REIT Financial Statement Overview
Summary
Slate Grocery REIT exhibits strong revenue growth with effective cost management, resulting in healthy margins. The balance sheet reflects a balanced leverage strategy, although high liabilities necessitate careful monitoring. Cash flow generation is robust but requires strategic management.Income Statement
Slate Grocery REIT has shown consistent revenue growth over the years, with a noticeable increase from 2021 to 2024. The gross profit margin is strong, indicating effective management of costs relative to revenue. However, the net profit margin, while positive, reflects a moderate level of profitability, suggesting room for improvement in controlling other operational expenses. The EBITDA margin is robust, highlighting the company's ability to generate earnings before accounting for interest, taxes, depreciation, and amortization.85
Very Positive
Balance Sheet
The balance sheet of Slate Grocery REIT presents a moderate debt-to-equity ratio, indicative of a balanced leverage strategy. However, the return on equity has shown variability, suggesting fluctuating efficiency in generating profits from shareholders' equity. The equity ratio is relatively stable, signifying a solid capital structure. Nevertheless, the company’s total liabilities are substantial, which could pose risks if not managed properly.70
Positive
Cash Flow
The cash flow statements reveal a positive trend in free cash flow, reflecting the company's capacity to generate cash after capital expenditures. The operating cash flow to net income ratio indicates solid cash conversion, enhancing financial flexibility. However, fluctuations in financing and investing cash flows suggest potential volatility in cash management strategies.78
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 210.29M | 209.13M | 203.28M | 177.49M | 138.28M | 126.13M |
| Gross Profit | 138.32M | 135.40M | 130.47M | 127.41M | 100.86M | 91.50M |
| EBITDA | 100.22M | 128.47M | 86.77M | 140.66M | 104.87M | 77.40M |
| Net Income | 42.17M | 39.67M | 13.60M | 128.80M | 90.87M | 41.26M |
Balance Sheet | ||||||
| Total Assets | 2.24B | 2.23B | 2.24B | 2.27B | 1.74B | 1.32B |
| Cash, Cash Equivalents and Short-Term Investments | 23.66M | 22.67M | 23.59M | 20.39M | 14.04M | 2.36M |
| Total Debt | 1.17B | 1.17B | 1.16B | 1.13B | 937.74M | 726.37M |
| Total Liabilities | 1.38B | 1.38B | 1.37B | 1.34B | 1.11B | 870.84M |
| Stockholders Equity | 670.91M | 673.47M | 687.44M | 740.51M | 619.02M | 452.72M |
Cash Flow | ||||||
| Free Cash Flow | 69.13M | 67.04M | 71.78M | 51.95M | 46.12M | 36.61M |
| Operating Cash Flow | 73.49M | 70.97M | 76.30M | 58.99M | 50.80M | 39.35M |
| Investing Cash Flow | -10.10M | -10.43M | -20.55M | -381.74M | -190.85M | 5.79M |
| Financing Cash Flow | -63.14M | -61.46M | -52.55M | 329.11M | 151.72M | -45.19M |
Slate Grocery REIT Technical Analysis
Positive
14.48
Price Trends
14.47
Positive
14.05
Positive
13.61
Positive
Market Momentum
0.03
Negative
53.79
Neutral
78.74
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:SGR.UN, the sentiment is Positive. The current price of 14.48 is above the 20-day moving average (MA) of 14.34, above the 50-day MA of 14.47, and above the 200-day MA of 13.61, indicating a bullish trend. The MACD of 0.03 indicates Negative momentum. The RSI at 53.79 is Neutral, neither overbought nor oversold. The STOCH value of 78.74 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:SGR.UN.
Slate Grocery REIT Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | C$869.36M | 15.47 | 5.85% | 0.58% | 3.90% | 8.72% | |
76 Outperform | C$450.56M | 18.25 | 4.57% | 6.86% | 6.36% | 13.91% | |
75 Outperform | C$952.13M | 8.59 | 5.83% | 4.14% | 3.85% | -31.81% | |
69 Neutral | C$930.47M | 5.44 | 11.76% | 7.37% | 13.04% | ― | |
64 Neutral | $6.89B | 17.45 | -1.92% | 7.02% | 4.59% | -24.66% | |
62 Neutral | C$962.62M | ― | -11.97% | 0.24% | 4.39% | 56.33% | |
57 Neutral | $747.06M | ― | -1.80% | 7.80% | -13.42% | 86.55% |
* Real Estate Sector Average
Performance Comparison
TSE:SGR.UN
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14.48
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32.24%
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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.