NETSTREIT (NTST) AI Stock Analysis

• Market Cap: $1.36B
• Dividend Yield: 5.06%
• Average Volume (3M): 1.04M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.71
• Revenue Growth: 23.25%
• EPS Growth: -246.41%
• Country: US
• Employees: 22
• Sector: Real Estate
• Sector Strength: 79
• Industry: REIT - Retail
• EPS (TTM): -0.15
• Shares Outstanding: 81,698,944
• 10 Day Avg. Volume: 1,279,310
• 30 Day Avg. Volume: 1,044,607
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 7.54
• Price to Cash Flow (P/CF): 10.90
• P/FCF Ratio: 8.40
• 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: $17.83
• Price Target Upside: 8.06% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 9

NTST's strong revenue growth, no debt, and positive operating cash flow are key strengths. However, challenges in profitability and tenant issues present risks. The technical indicators suggest positive momentum, while valuation metrics offer mixed signals due to high P/E and a good dividend yield. Strategic corporate actions and earnings call insights add to the outlook, but profitability issues weigh on the score.

Positive Factors

Investment Strategy

NTST's investment strategy focuses on defensive tenancy in necessity-based and E-commerce-resistant retail industries.

Valuation

NTST trades below the private market value of its portfolio, indicating potential for positive valuation adjustments.

Negative Factors

Investment Activity

NTST’s investment activity guidance was lower than expected but considered reasonable due to the recent decline in share price.

Tenant Risk

Investor concern exists around negative headlines affecting some of NTST's key tenants, impacting the stock.

NETSTREIT Business Overview & Revenue Model

Company Description

NETSTREIT is an internally managed Real Estate Investment Trust (REIT) based in Dallas, Texas that specializes in acquiring single-tenant net lease retail properties nationwide. The growing portfolio consists of high-quality properties leased to e-commerce resistant tenants with healthy balance sheets. Led by a management team of seasoned commercial real estate executives, NETSTREIT's strategy is to create the highest quality net lease retail portfolio in the country with the goal of generating consistent cash flows and dividends for its investors.

How the Company Makes Money

NETSTREIT makes money by acquiring and leasing out single-tenant retail properties under net lease agreements. These leases often require tenants to pay a significant portion of the property's operating expenses, such as maintenance, insurance, and taxes, in addition to the base rent. This structure allows NETSTREIT to generate stable and predictable rental income while minimizing its exposure to property-related expenses. The company's revenue streams are primarily derived from these rental payments. Additionally, NETSTREIT's growth strategy involves acquiring properties with strong tenants and favorable lease terms, which can enhance its income and asset value over time.

NETSTREIT Financial Statement Overview

Summary

NTST displays robust revenue growth and a solid balance sheet with significant equity and no debt as of 2024, providing financial stability. However, challenges in profitability, negative net income, and declining EBIT margins need addressing. Positive operating cash flow and strategic investments suggest potential for long-term growth.

Income Statement

NTST has shown a strong revenue growth trajectory over the years, with a significant increase from $19.8M in 2019 to $162.8M in 2024. Despite the impressive top-line growth, the company is grappling with profitability challenges, as indicated by negative net income in 2024 and declining EBIT margins from 24.6% in 2019 to 11.3% in 2024. The gross profit margin remains robust at around 99.8%, but the net profit margin has suffered, reflecting rising operational costs or other expenses.

Balance Sheet

The balance sheet of NTST is solid, characterized by a substantial increase in stockholders' equity from $164.5M in 2019 to $1.33B in 2024, reflecting strong investor confidence and asset growth. A notable improvement is the elimination of total debt in 2024, significantly strengthening the company's equity position with an equity ratio of 58.9%. The return on equity has been impacted by net losses, but the lack of debt provides financial flexibility and reduces potential risks associated with leverage.

Cash Flow

NTST's cash flow statements reveal a positive trend in operating cash flow, which increased from $6M in 2019 to $90.2M in 2024, demonstrating effective cash generation from core operations. The free cash flow has also expanded significantly, although large investing cash outflows indicate substantial capital investment activities. The operating cash flow to net income ratio is strong, indicating efficient conversion of earnings into cash flow, despite negative net income in recent years.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
162.78M	123.12M	96.28M	59.14M	33.73M
	Gross Profit
162.43M	106.25M	84.58M	53.34M	31.16M
	EBIT
18.44M	24.10M	15.59M	8.15M	4.35M
	EBITDA
98.24M	95.65M	65.66M	38.96M	19.81M
	Net Income Common Stockholders
-11.94M	6.84M	8.12M	3.05M	-4.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
14.32M	18.43M	70.54M	7.60M	92.64M
	Total Assets
2.26B	1.95B	1.61B	1.07B	725.82M
	Total Debt
894.28M	640.25M	524.32M	261.65M	191.03M
	Net Debt
879.96M	621.82M	453.78M	254.04M	98.39M
	Total Liabilities
921.21M	672.80M	547.27M	278.63M	197.74M
	Stockholders Equity
1.33B	1.26B	1.05B	779.17M	494.10M
Cash Flow		Free Cash Flow
90.16M	80.12M	49.44M	30.75M	12.70M
	Operating Cash Flow
90.16M	80.16M	50.65M	31.48M	12.75M
	Investing Cash Flow
-432.88M	-451.95M	-468.36M	-430.13M	-362.13M
	Financing Cash Flow
327.10M	331.18M	480.65M	313.61M	272.71M

NETSTREIT Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 16.50
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NTST, the sentiment is Positive. The current price of 16.5 is above the 20-day moving average (MA) of 15.52, above the 50-day MA of 14.93, and above the 200-day MA of 15.23, indicating a bullish trend. The MACD of 0.29 indicates Negative momentum. The RSI at 68.16 is Neutral, neither overbought nor oversold. The STOCH value of 92.38 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NTST.

NETSTREIT Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GTY	78 Outperform	$1.59B	23.08	7.41%	6.35%	9.44%	8.76%
NTST	76 Outperform	$1.36B	―	-0.92%	5.06%	23.25%	-246.41%
WSR	73 Outperform	$1.35B	18.46	8.66%	3.82%	5.13%	88.91%
IVT	67 Neutral	$2.13B	142.85	0.82%	3.34%	5.61%	135.64%
PINE	66 Neutral	$230.46M	116.20	0.82%	6.80%	14.17%	-26.37%
BFS	65 Neutral	$801.53M	20.27	14.81%	7.12%	4.64%	-5.26%
Sector *	59 Neutral	$2.71B	11.52	0.08%	8691.97%	5.56%	-16.56%

NETSTREIT Corporate Events

NETSTREIT Reports Q4 2024 Results and 2025 Outlook

On February 24, 2025, NETSTREIT Corp. reported its financial and operating results for the fourth quarter and full year ending December 31, 2024. The company achieved a record gross investment activity of $195.1 million at a 7.4% cash yield during the fourth quarter and introduced a 2025 AFFO per share guidance of $1.27 to $1.30. Despite reporting a net loss of $0.07 per diluted share for the fourth quarter, NETSTREIT completed significant capital recycling and closed $275 million in additional financing commitments in January 2025, positioning itself for future growth with a focus on enhancing tenant diversity and internal growth.