STAG Industrial, Inc. (NYSE: STAG)

Sector: Real Estate Industry: REIT - Industrial CIK: 0001479094
Market Cap 7.19 Bn
P/B 2.00
P/E 26.29
P/S 8.50
ROIC (Qtr) 4.71
Div Yield % 3.54
Rev 1y % (Qtr) 10.82
Total Debt (Qtr) 3.29 Bn
Debt/Equity (Qtr) 0.92
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About

STAG Industrial, Inc., known as STAG, operates in the real estate investment trust (REIT) industry, specifically focusing on the acquisition, ownership, and operation of industrial properties across the United States. The company's primary business objective is to create a balanced and diversified portfolio of industrial properties that yield attractive long-term returns for its stockholders. STAG's portfolio comprises 569 buildings in 41 states, encompassing approximately 112.3 million square feet of rentable space. This portfolio is diversified...

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Investment thesis

Bull case

  • Operating cash flow of 463.39M provides exceptional 80.58x coverage of minority interest expenses 5.75M, showing strong core operations.
  • Operating cash flow of 463.39M provides strong 36.43x coverage of stock compensation 12.72M, indicating sustainable incentive practices.
  • Strong operating cash flow of 463.39M provides 8.92x coverage of SG&A expenses 51.93M, showing efficient operational cost management.
  • Cash position of 100.88M provides exceptional 17.54x coverage of minority interest expenses 5.75M, indicating strong liquidity.
  • Operating cash flow of 463.39M exceeds receivables of 156.46M by 2.96x, demonstrating excellent collection efficiency.

Bear case

  • Operating cash flow of 463.39M barely covers its investment activities of (497.30M), with a coverage ratio of -0.93, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 463.39M provides thin coverage of dividend payments of (283.97M) with a -1.63 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Cash reserves of 100.88M provide limited coverage of acquisition spending of (350000), which is -288.24x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Free cash flow of 21.19M provides weak coverage of capital expenditures of 442.19M, with a 0.05 ratio suggesting additional external financing needs for growth initiatives.
  • Operating earnings of 405.68M show weak coverage of depreciation charges of 301.80M, with a 1.34 ratio indicating high capital intensity and potential reinvestment needs.

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 1.43 1.14
EV to Cash from Ops. EV/CFO 22.23 24.26
EV to Debt EV to Debt 3.13 3.22
EV to EBIT EV/EBIT 25.40 50.75
EV to EBITDA EV/EBITDA 16.65 19.38
EV to Free Cash Flow [EV/FCF] EV/FCF 486.13 -0.63
EV to Market Cap EV to Market Cap 1.43 1.57
EV to Revenue EV/Rev 12.19 12.09
Price to Book Value [P/B] P/B 2.00 2.55
Price to Earnings [P/E] P/E 26.29 22.14
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.96 -0.46
Dividend Payout Ratio % Div Payout % (Qtr) 101.40 34.94
Dividend per Basic Share Div per Share (Qtr) 1.36 3.19
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 1,203.54 25.32
Interest Coverage Int. cover (Qtr) 3.07 3.92
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 32.20 -38.11
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 169.79 19.56
Dividend Growth (1y) % Div 1y % (Qtr) -7.48 41.56
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 34.16 27.07
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 11.27 9.45
EBIT Growth (1y) % EBIT 1y % (Qtr) 34.16 22.14
EBT Growth (1y) % EBT 1y % (Qtr) 44.55 19.88
EPS Growth (1y) % EPS 1y % (Qtr) 40.38 14.36
FCF Growth (1y) % FCF 1y % (Qtr) 111.04 -604.79
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 9.93 3.65
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.12 0.14
Cash Payout Ratio Cash Payout (Qtr) 0.31 0.34
Cash Ratio Cash Ratio 0.00 0.00
Current Ratio Current Ratio 0.00 0.06
Debt to Equity Ratio Debt/Equity (Qtr) 0.92 1.46
Interest Cover Ratio Int Coverage (Qtr) 3.07 3.92
Times Interest Earned Times Interest Earned (Qtr) 3.07 3.92
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 83.70 67.77
EBIT Margin % EBIT Margin % (Qtr) 48.00 40.11
EBT Margin % EBT Margin % (Qtr) 32.36 24.24
Gross Margin % Gross Margin % (Qtr) 79.70 76.41
Net Profit Margin % Net Margin % (Qtr) 32.30 22.54