NexPoint Residential (NXRT) AI Stock Analysis

• Market Cap: $934.99M
• Dividend Yield: 5.33%
• Average Volume (3M): 173.84K
• Price to Earnings (P/E): 865.7
• Beta (1Y): 0.96
• Revenue Growth: -6.42%
• EPS Growth: -98.33%
• Country: US
• Employees: 2
• Sector: Real Estate
• Sector Strength: 77
• Industry: REIT - Residential
• EPS (TTM): >-0.01
• Shares Outstanding: 25,534,466
• 10 Day Avg. Volume: 124,526
• 30 Day Avg. Volume: 173,841
• PEG Ratio: 0.40
• Price to Book (P/B): N/A
• Price to Sales (P/S): 3.71
• Price to Cash Flow (P/CF): 37.50
• P/FCF Ratio: 0.00
• 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: $43.75
• Price Target Upside: 19.96% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4

NexPoint Residential's score reflects strong operational margins and equity position but is hindered by inconsistent profitability and cash flow issues. The bearish technical indicators and high P/E ratio further weigh on the stock, despite a favorable dividend yield. The earnings call provided mixed insights, highlighting strategic successes but also profitability challenges.

Positive Factors

Earnings

The company reported a core FFO number that was three cents higher than consensus estimates.

Financial Performance

NXRT is in a strong liquidity position with approximately $23.1 million of cash and cash equivalents and $350 million free and clear under its credit facility.

Shareholder Returns

The Board approved an increase in the quarterly dividend of 10.3% from the previous dividend.

Negative Factors

Debt Management

The refinancing reduced the company's weighted average interest rate and extended the weighted average debt maturity, reducing near-term refinancing pressure.

NexPoint Residential Business Overview & Revenue Model

Company Description

NexPoint Residential Trust, Inc. (NXRT) is a publicly traded real estate investment trust (REIT) that specializes in acquiring, owning, and operating well-located, middle-income multifamily properties primarily in the southeastern and southwestern United States. The company focuses on value-add multifamily investments, implementing property improvements and management strategies to enhance the value of its properties while providing quality housing options to its tenants.

How the Company Makes Money

NexPoint Residential makes money through rental income generated from its portfolio of multifamily properties. The company focuses on acquiring undervalued properties where it can implement value-add strategies such as renovations and operational improvements to increase occupancy rates and rental income. By enhancing the properties, NXRT can charge higher rents, thereby boosting its overall revenue. Additionally, the company may engage in strategic property sales when market conditions are favorable, realizing capital gains that contribute to its earnings. NXRT's revenue model is heavily reliant on effective property management and maintaining high occupancy levels to ensure a steady stream of rental income.

NexPoint Residential Financial Statement Overview

Summary

NexPoint Residential shows inconsistent profitability with strong operational margins but weak cash flow management. The equity position is strong, but the lack of debt sustainability without cash flow improvements is concerning.

Income Statement

NexPoint Residential has shown inconsistent revenue growth, with a slight decline in 2024, following growth in previous years. The gross profit margin in 2024 was strong at approximately 84.41%, but the net profit margin was low due to significantly reduced net income. Additionally, the EBIT and EBITDA margins were reasonable, indicating operational efficiency, although net income fluctuations point to volatility in profitability.

Balance Sheet

The company maintains a relatively strong equity position with a debt-to-equity ratio of 0 for 2024, indicating no debt burden, which is positive. However, the equity ratio decreased to about 21.51%, reflecting potential vulnerability to asset value fluctuations. The return on equity is low due to minimal net income, suggesting limited profitability relative to equity.

Cash Flow

NexPoint Residential's cash flow statement indicates challenges, with zero operating and free cash flow in 2024, a significant drop from previous years. This raises concerns about cash management and operational cash generation. Historical free cash flow to net income ratios were omitted due to zero values, highlighting potential short-term liquidity issues.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
259.70M	277.53M	263.95M	219.24M	204.80M
	Gross Profit
219.16M	167.13M	159.07M	131.02M	119.65M
	EBIT
83.56M	113.18M	32.84M	19.83M	15.34M
	EBITDA
202.99M	250.01M	130.49M	151.30M	165.13M
	Net Income Common Stockholders
1.11M	44.26M	-64.80M	-23.21M	-2.51M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
23.15M	12.37M	16.76M	49.45M	24.46M
	Total Assets
1.91B	2.11B	2.23B	2.06B	1.83B
	Total Debt
1.46B	1.48B	1.60B	1.55B	1.35B
	Net Debt
1.44B	1.46B	1.58B	1.51B	1.32B
	Total Liabilities
1.49B	1.61B	1.70B	1.59B	1.42B
	Stockholders Equity
410.37M	494.62M	519.67M	469.85M	407.93M
Cash Flow		Free Cash Flow
73.57M	96.58M	79.10M	73.27M	57.23M
	Operating Cash Flow
73.57M	96.58M	79.10M	73.27M	57.23M
	Investing Cash Flow
130.62M	51.92M	-162.30M	-235.91M	11.50M
	Financing Cash Flow
-195.55M	-155.02M	46.31M	194.32M	-82.90M

NexPoint Residential Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 36.47
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NXRT, the sentiment is Negative. The current price of 36.47 is below the 20-day moving average (MA) of 36.51, below the 50-day MA of 38.23, and below the 200-day MA of 41.22, indicating a bearish trend. The MACD of -0.54 indicates Negative momentum. The RSI at 47.26 is Neutral, neither overbought nor oversold. The STOCH value of 70.70 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NXRT.

NexPoint Residential Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IRT	67 Neutral	$4.64B	111.42	1.14%	3.27%	-3.17%	―
BRT	61 Neutral	$295.11M	―	-4.52%	6.41%	2.15%	-556.06%
Sector *	59 Neutral	$2.72B	11.59	0.11%	8770.69%	5.44%	-16.52%
CLPR	58 Neutral	$60.55M	―	46.22%	10.13%	7.65%	42.14%
CSR	57 Neutral	$1.05B	―	-1.53%	5.06%	-21.69%	-154.55%
NXRT	50 Neutral	$934.99M	865.72	0.25%	5.33%	-6.42%	-98.33%
AIV	41 Neutral	$1.10B	―	-44.01%	―	11.60%	36.23%

NexPoint Residential Corporate Events

NexPoint Residential Appoints New CFO Amid Leadership Shift

NexPoint Residential Trust has announced a leadership transition, with Paul Richards appointed as the new Chief Financial Officer and principal financial officer effective January 1, 2025, following the resignation of Brian Mitts. This change is expected to influence the company’s financial management and operations as Richards brings experience from various affiliated real estate and finance positions, potentially impacting stakeholders by aligning the company’s strategic financial direction with its broader real estate and asset management objectives.