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Gladstone Commercial Corp (GOOD)
NASDAQ:GOOD
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Gladstone Commercial
(NASDAQ:GOOD)
63Neutral
Positive Factors
Financial Performance
The company successfully collected 100% of cash rents for the fourth quarter and full year.
Occupancy Rates
Occupancy as of December 31 stood at 98.7%, up 20 basis points quarter over.
Negative Factors
Debt Levels
The company does have slightly higher than average level of debt and preferred totaling ~50% to total capitalization.
Gladstone Commercial (GOOD) vs. S&P 500 (SPY)
Market Cap
$686.42M
Dividend Yield8.05%
Average Volume (3M)540.95K
Price to Earnings (P/E)56.3
Beta (1Y)0.99
Revenue Growth1.22%
EPS GrowthN/A
CountryUS
Employees69
SectorReal Estate
Sector Strength73
IndustryREIT - Diversified
Share Statistics
EPS (TTM)0.25
Shares Outstanding45,756,886
10 Day Avg. Volume404,284
30 Day Avg. Volume540,952
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)4.36
Price to Cash Flow (P/CF)7.10
P/FCF Ratio7.10
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$17.17Price Target Upside14.62% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
Gladstone Commercial Business Overview & Revenue Model
Company DescriptionGladstone Commercial Corporation (GOOD) is a real estate investment trust (REIT) that focuses on acquiring, owning, and managing a diverse portfolio of net leased industrial and office properties across the United States. The company primarily invests in properties leased to established businesses in various sectors, aiming to provide stable and consistent returns to its shareholders through rental income and capital appreciation.
How the Company Makes MoneyGladstone Commercial makes money primarily through the acquisition and management of commercial real estate properties that are leased to businesses under long-term, net lease agreements. These agreements typically require tenants to cover most property-related expenses such as maintenance, taxes, and insurance, thus ensuring a steady stream of rental income for Gladstone. Additionally, the company seeks to generate revenue through strategic property acquisitions that offer potential for value appreciation and higher rental yields. Partnerships with established businesses and careful selection of tenants contribute to its earnings by reducing vacancy risks and enhancing property value over time.
Gladstone Commercial Financial Statement Overview
Summary
Gladstone Commercial demonstrates strong revenue growth and cash flow management. However, operational efficiencies and a high leverage position on the balance sheet could be improved.Income Statement
Gladstone Commercial has shown consistent revenue growth over the years, with a notable increase in net income for the latest year, moving from a loss to a profit. The company exhibits strong gross profit margins, indicating efficient cost management. However, the EBIT and EBITDA margins suggest room for improvement in operating efficiency.77
Positive
Balance Sheet
The company maintains a stable equity ratio, reflecting a solid capital structure. However, the high debt-to-equity ratio points to significant leverage, which could pose risks in a rising interest rate environment. Return on equity has improved, which is a positive sign of profitability.65
Positive
Cash Flow
Gladstone Commercial demonstrates strong cash flow management, with consistent free cash flow generation. The company has improved its operating cash flow to net income ratio, indicating efficient cash conversion processes. The free cash flow to net income ratio further highlights effective cash utilization.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 149.39M | 147.58M | 148.98M | 137.69M | 133.15M | Gross Profit |
| 149.39M | 115.35M | 122.15M | 110.59M | 107.15M | EBIT |
| 123.97M | 50.78M | 43.77M | 37.75M | 37.31M | EBITDA |
| 117.23M | 101.30M | 100.86M | 96.97M | 90.51M | Net Income Common Stockholders |
| 11.17M | 4.99M | -23.18M | -19.99M | -12.26M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 10.96M | 11.98M | 11.65M | 7.96M | 11.02M | Total Assets |
| 1.09B | 1.13B | 1.20B | 1.14B | 1.10B | Total Debt |
| 347.60M | 743.95M | 754.51M | 713.03M | 674.38M | Net Debt |
| 336.64M | 731.97M | 742.86M | 705.08M | 663.36M | Total Liabilities |
| 923.05M | 809.16M | 996.94M | 940.79M | 881.87M | Stockholders Equity |
| 170.04M | 170.04M | 202.78M | 201.30M | 213.18M |
| Cash Flow | Free Cash Flow | |||
| 56.95M | 60.37M | 62.35M | 64.78M | 59.13M | Operating Cash Flow |
| 56.95M | 60.37M | 69.18M | 70.13M | 65.49M | Investing Cash Flow |
| -1.73M | 1.14M | -82.51M | -94.78M | -100.26M | Financing Cash Flow |
| -56.29M | -61.36M | 16.15M | 21.75M | 39.35M |
Gladstone Commercial Technical Analysis
Neutral
14.98
Price Trends
15.58
Negative
15.92
Negative
15.20
Negative
Market Momentum
-0.21
Negative
44.05
Neutral
67.58
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GOOD, the sentiment is Neutral. The current price of 14.98 is below the 20-day moving average (MA) of 15.03, below the 50-day MA of 15.58, and below the 200-day MA of 15.20, indicating a bearish trend. The MACD of -0.21 indicates Negative momentum. The RSI at 44.05 is Neutral, neither overbought nor oversold. The STOCH value of 67.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for GOOD.
Gladstone Commercial Risk Analysis
Gladstone Commercial disclosed 52 risk factors in its most recent earnings report. Gladstone Commercial reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Gladstone Commercial Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $50.48B | 57.67 | 2.40% | 5.53% | 29.49% | -22.38% | |
79 Outperform | $7.91B | 19.55 | 9.32% | 5.48% | 4.97% | -0.26% | |
78 Outperform | $3.93B | 32.23 | 6.11% | 6.58% | -1.01% | -18.46% | |
73 Outperform | $9.63B | 24.42 | 13.80% | 4.87% | 1.51% | -5.16% | |
72 Outperform | $13.72B | 30.00 | 5.38% | 5.57% | -9.09% | -36.58% | |
63 Neutral | $686.42M | 56.31 | 7.10% | 8.05% | 1.22% | ― | |
61 Neutral | $4.70B | 17.65 | -3.00% | 11.43% | 5.99% | -19.07% |
* Real Estate Sector Average
Performance Comparison
GOOD
Gladstone Commercial
14.98
2.39
18.98%
CUBE
Cubesmart
42.71
-0.85
-1.95%
NNN
National Retail Properties
42.65
2.59
6.47%
O
Realty Income
58.01
7.22
14.22%
WPC
W. P. Carey Inc.
63.11
10.32
19.55%
EPR
EPR Properties
52.61
13.82
35.63%
Gladstone Commercial Earnings Call Summary
Earnings Call Date: Feb 18, 2025 | % Change Since: -5.37% | Next Earnings Date: Apr 30, 2025
Earnings Call Sentiment Positive
The earnings call reflects a generally positive outlook with strong operational performance and strategic growth in industrial properties. However, there are slight concerns over financial metrics and market conditions, particularly in the office segment.Highlights
100% Rent Collection
During 2024, Gladstone Commercial Corporation collected 100% of cash-based rents, demonstrating strong tenant relationships and financial stability.
Increased Industrial Concentration
Increased portfolio industrial concentration to 63% of annualized straight-line rent, with plans to grow this to 70%.
Strong Portfolio Occupancy
Achieved a portfolio occupancy rate of 98.7% as of December 31, 2024.
Successful Private Placement
Closed on a $75 million private placement of senior unsecured notes, strengthening the balance sheet for future growth.
Lease Renewal Success
Renewed or extended over 2.9 million square feet of leases, resulting in a $3.8 million net increase in GAAP rent.
Lowlights
Slight Decrease in FFO
FFO and core FFO per share available to common stockholders were both $0.35 for Q4 2024, compared to $0.36 in Q4 2023.
Interest Rate and Market Challenges
The Federal Reserve's pause in interest rate cuts and ongoing market volatility pose challenges for future growth.
Office Segment Risk
Continued focus on reducing office property holdings due to market conditions, indicating potential risk in this segment.
Company Guidance
During the Gladstone Commercial Corporation Year-End Earnings Call for the fourth quarter of the 2024 fiscal year, several key metrics were highlighted. The company reported funds from operations (FFO) and core FFO per share available to common stockholders at $0.35 for the quarter, a slight decrease from $0.36 in the same quarter of the previous year. For the fiscal year ending December 31, 2024, FFO and core FFO were $1.41 and $1.42 per share, respectively. The same-store rents increased by 5% over the previous year, driven by higher straight-line rent rates and recovery revenue. Gladstone Commercial maintained a high portfolio occupancy of 98.7% and collected 100% of cash-based rents during the year. The company acquired campus properties totaling 316,727 square feet for $26.8 million and increased its portfolio's industrial concentration to 63% of annualized straight-line rent. Additionally, they completed a $75 million private placement of senior unsecured notes, further strengthening their balance sheet. Going forward, the company aims to increase its industrial concentration to at least 70% while maintaining disciplined underwriting standards.Gladstone Commercial Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Gladstone Commercial Announces Leadership Transition Plans
Neutral
Nov 15, 2024
Terry Lee Brubaker, the COO of Gladstone Commercial Corporation, will retire on December 2, 2024, marking a significant leadership change for the company. Michael LiCalsi, the General Counsel, will take on additional operational duties while a national search is conducted for a new Chief Investment Officer. This transition comes as Gladstone Commercial, a REIT known for its diverse portfolio of industrial and office properties, continues to grow its footprint across the U.S.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.