Lineage, Inc. (NASDAQ: LINE)

Sector: Real Estate Industry: REIT - Industrial CIK: 0001868159
Market Cap 10.60 Bn
P/B 1.26
P/E -59.87
P/S 1.98
ROIC (Qtr) 0.65
Div Yield % 7.11
Rev 1y % (Qtr) 3.15
Total Debt (Qtr) 7.77 Bn
Debt/Equity (Qtr) 0.93
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About

Investment thesis

Bull case

  • Healthy cash reserves of 75M provide 3.41x coverage of short-term debt 22M, demonstrating strong liquidity position and minimal refinancing risk.
  • Tangible assets of 14.61B provide exceptional 173.90x coverage of deferred revenue 84M, showing strong service capability backing.
  • Strong operating cash flow of 884M provides 1.51x coverage of SG&A expenses 587M, showing efficient operational cost management.
  • Operating cash flow of 884M provides strong 10.52x coverage of deferred revenue 84M, indicating service delivery capability.
  • Tangible assets of 14.61B provide robust 66.70x coverage of other current liabilities 219M, indicating strong asset backing.

Bear case

  • Operating cash flow of 884M barely covers its investment activities of (1.28B), with a coverage ratio of -0.69, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 884M provides thin coverage of dividend payments of (547M) with a -1.62 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Cash reserves of 75M provide limited coverage of acquisition spending of (688M), which is -0.11x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • High receivables of 857M relative to inventory of 167M (5.13 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • Operating cash flow of 884M provides minimal -30.48x coverage of tax expenses of (29M), suggesting potential tax planning inefficiencies or unsustainable tax positions.

Segments Breakdown of Revenue (2024)

Segments Breakdown of Revenue (2024)

Peer comparison

Companies in the REIT - Industrial
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 PLD Prologis, Inc. 131.57 Bn 39.60 14.97 35.04 Bn
2 PSA Public Storage 52.97 Bn 33.41 10.98 10.25 Bn
3 EXR Extra Space Storage Inc. 15.99 Bn 113.72 34.08 13.66 Bn
4 LINE Lineage, Inc. 10.60 Bn -59.87 1.98 7.77 Bn
5 EGP Eastgroup Properties Inc 10.17 Bn 39.51 14.10 1.63 Bn
6 REXR Rexford Industrial Realty, Inc. 8.74 Bn 43.69 8.72 3.25 Bn
7 FR First Industrial Realty Trust Inc 7.95 Bn 32.11 10.93 2.57 Bn
8 STAG STAG Industrial, Inc. 7.19 Bn 26.29 8.50 3.29 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.94 1.14
EV to Cash from Ops. EV/CFO 20.50 24.26
EV to Debt EV to Debt 2.33 3.22
EV to EBIT EV/EBIT 362.52 50.75
EV to EBITDA EV/EBITDA 18.22 19.38
EV to Free Cash Flow [EV/FCF] EV/FCF 100.14 -0.63
EV to Market Cap EV to Market Cap 1.71 1.57
EV to Revenue EV/Rev 3.38 12.09
Price to Book Value [P/B] P/B 1.26 2.55
Price to Earnings [P/E] P/E -59.87 22.14
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) -0.32 -0.46
Dividend Payout Ratio % Div Payout % (Qtr) -340.30 34.94
Dividend per Basic Share Div per Share (Qtr) 2.11 3.19
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 265.74 25.32
Interest Coverage Int. cover (Qtr) 0.20 3.92
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -10.71 -38.11
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -81.80 19.56
Dividend Growth (1y) % Div 1y % (Qtr) 455.26 41.56
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 123.76 27.07
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 77.36 9.45
EBIT Growth (1y) % EBIT 1y % (Qtr) 125.51 22.14
EBT Growth (1y) % EBT 1y % (Qtr) 70.49 19.88
EPS Growth (1y) % EPS 1y % (Qtr) 82.83 14.36
FCF Growth (1y) % FCF 1y % (Qtr) 330.95 -604.79
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -2.43 3.65
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.28 0.14
Cash Payout Ratio Cash Payout (Qtr) 0.34 0.34
Cash Ratio Cash Ratio (Qtr) 0.06 0.00
Current Ratio Curr Ratio (Qtr) 0.99 0.06
Debt to Equity Ratio Debt/Equity (Qtr) 0.93 1.46
Interest Cover Ratio Int Coverage (Qtr) 0.20 3.92
Times Interest Earned Times Interest Earned (Qtr) 0.20 3.92
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 17.80 67.77
EBIT Margin % EBIT Margin % (Qtr) 0.93 40.11
EBT Margin % EBT Margin % (Qtr) -3.84 24.24
Gross Margin % Gross Margin % (Qtr) 32.20 76.41
Net Profit Margin % Net Margin % (Qtr) -3.30 22.54