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Piedmont Office (PDM)
NYSE:PDM
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Piedmont Office
(NYSE:PDM)
50Neutral
Piedmont Office (PDM) vs. S&P 500 (SPY)
Market Cap
$918.52M
Dividend Yield6.77%
Average Volume (3M)881.70K
Price to Earnings (P/E)―
Beta (1Y)1.46
Revenue Growth-5.58%
EPS Growth-63.09%
CountryUS
Employees150
SectorReal Estate
Sector Strength63
IndustryREIT - Office
Share Statistics
EPS (TTM)-0.64
Shares Outstanding124,291,670
10 Day Avg. Volume773,323
30 Day Avg. Volume881,699
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.58
Price to Cash Flow (P/CF)3.50
P/FCF Ratio3.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$9.33Price Target Upside26.42% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
Piedmont Office Business Overview & Revenue Model
Company DescriptionPiedmont Office (PDM) is a real estate investment trust (REIT) specializing in the acquisition, ownership, and management of high-quality office properties in key markets across the United States. The company focuses on large Class A office buildings in major metropolitan areas, catering to a diverse range of corporate clients seeking premium office spaces. PDM's core services include leasing, property management, and development of office assets.
How the Company Makes MoneyPiedmont Office makes money primarily through leasing office space to various tenants, which generates consistent rental income. The company also earns revenue from property management services, including maintenance and tenant services, which are often billed separately or included in lease agreements. Additionally, PDM may engage in strategic property sales to capitalize on asset appreciation and reinvest in higher-yield opportunities. Significant partnerships with corporate clients and real estate brokers can enhance occupancy rates and drive revenue growth. The company's earnings are influenced by market demand for office space, occupancy rates, lease terms, and property values.
Piedmont Office Financial Statement Overview
Summary
Piedmont Office shows stable revenue but struggles with profitability, reflected in declining net income and earnings margins. The balance sheet is moderately leveraged, but rising debt levels pose risks. Cash flow generation is positive, yet erratic free cash flow growth suggests potential operational challenges. Overall, the company faces profitability and leverage concerns despite stable revenue streams.Income Statement
The gross profit margin remained strong with consistent revenues, but net profit margin has been negative recently, reflecting a decline in profitability. Revenue growth has stagnated, and EBIT margins are under pressure. The absence of EBITDA in the recent year adds uncertainty to the earnings potential.45
Neutral
Balance Sheet
The debt-to-equity ratio shows moderate leverage, but rising debt levels are a concern. The equity ratio is stable, suggesting a decent asset structure, but return on equity is hampered by recent net losses, which impacts overall financial stability.55
Neutral
Cash Flow
Operating cash flow is positive and has been stable, indicating good cash generation capabilities. However, free cash flow growth has been inconsistent, and the operating cash flow to net income ratio highlights potential issues in translating profits into cash.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 570.32M | 577.76M | 563.77M | 528.71M | 535.02M | Gross Profit |
| 336.20M | 340.72M | 337.71M | 317.78M | 320.09M | EBIT |
| 0.00 | 77.26M | 86.74M | 91.13M | 91.34M | EBITDA |
| 270.46M | 231.06M | 234.41M | 218.14M | 491.54M | Net Income Common Stockholders |
| -79.07M | -48.39M | 272.58M | -62.65M | 175.11M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 109.64M | 825.00K | 16.54M | 7.42M | 7.33M | Total Assets |
| 3.46B | 4.06B | 4.09B | 3.93B | 3.74B | Total Debt |
| 192.42M | 2.05B | 1.98B | 1.88B | 1.62B | Net Debt |
| 82.79M | 2.05B | 1.97B | 1.87B | 1.61B | Total Liabilities |
| 2.53B | 2.33B | 2.24B | 2.14B | 1.84B | Stockholders Equity |
| 1.59B | 1.72B | 1.85B | 1.79B | 1.90B |
| Cash Flow | Free Cash Flow | |||
| 198.11M | 51.94M | 93.86M | 119.58M | 80.70M | Operating Cash Flow |
| 198.11M | 210.13M | 215.22M | 242.20M | 193.28M | Investing Cash Flow |
| -186.62M | -196.02M | -1.25M | -368.93M | -197.88M | Financing Cash Flow |
| 98.18M | -29.50M | -203.23M | 126.38M | -1.58M |
Piedmont Office Technical Analysis
Neutral
7.38
Price Trends
7.76
Negative
8.45
Negative
8.53
Negative
Market Momentum
-0.09
Negative
48.55
Neutral
91.74
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PDM, the sentiment is Neutral. The current price of 7.38 is above the 20-day moving average (MA) of 7.29, below the 50-day MA of 7.76, and below the 200-day MA of 8.53, indicating a neutral trend. The MACD of -0.09 indicates Negative momentum. The RSI at 48.55 is Neutral, neither overbought nor oversold. The STOCH value of 91.74 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for PDM.
Piedmont Office Risk Analysis
Piedmont Office disclosed 57 risk factors in its most recent earnings report. Piedmont Office 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
Piedmont Office Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $5.04B | 100.54 | 0.98% | 4.26% | 6.71% | -45.29% | |
61 Neutral | $4.74B | 18.45 | -3.52% | 10.74% | 5.97% | -21.87% | |
60 Neutral | $11.92B | 757.85 | 0.23% | 5.72% | 4.10% | -92.47% | |
58 Neutral | $15.01B | 936.10 | 1.32% | 1.88% | -1.30% | -80.81% | |
55 Neutral | $3.15B | 31.20 | 4.27% | 6.82% | -0.98% | -32.02% | |
52 Neutral | $4.47B | 755.98 | 0.71% | 5.06% | 5.12% | ― | |
50 Neutral | $918.52M | ― | -4.78% | 6.77% | -5.58% | -63.09% |
* Real Estate Sector Average
Performance Comparison
PDM
Piedmont Office
7.38
0.99
15.49%
BXP
Boston Properties
68.92
8.35
13.79%
CUZ
Cousins Properties
29.93
7.50
33.44%
HIW
Highwoods Properties
29.34
5.11
21.09%
SLG
SL Green Realty
58.88
7.43
14.44%
VNO
Vornado Realty
38.70
11.68
43.23%
Piedmont Office Earnings Call Summary
Earnings Call Date: Feb 13, 2025 | % Change Since: -5.63% | Next Earnings Date: May 6, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong leasing activity, significant rental rate growth, and successful financial management, particularly in refinancing efforts. However, the company faced challenges with increased interest expenses and some downtime due to lease expirations. Overall, the positive aspects of leasing success and financial stability outweigh the negatives.Highlights
Record Leasing Activity
Piedmont completed 2.4 million square feet of total leasing in 2024, the most since 2015, with over a million square feet of new tenant leases. This resulted in a year-end lease percentage of 88.4%.
Strong Rental Rate Growth
The company experienced rental rate growth of approximately 12% on a cash basis and almost 20% on an accrual basis, the strongest growth in the past 5 years on an accrual basis and in over a decade on a cash basis.
Successful Refinancing
Piedmont completed a $400 million bond offering in June and now has no debt with a final maturity until 2028, providing financial stability.
Increased Same-Store NOI
Cash basis same-store NOI grew by 2.6%, well above projections and guidance for the year.
Lowlights
Increased Interest Expense
Core FFO was impacted by approximately $22 million or $0.17 per diluted share of increased net interest expense compared to the previous year.
Downtime and Lease Expirations
The company's 2024 results were affected by the sale of 2 properties and downtime between the expiration of a few large leases during the year.
Company Guidance
During the Piedmont Office Realty Trust's fourth quarter 2024 earnings call, several key metrics and guidance were discussed. The company reported completing 2.4 million square feet of total leasing for the year, marking the highest annual leasing since 2015, and achieved a year-end lease percentage of 88.4%. They experienced strong rental rate growth, with cash basis increases of approximately 12% and accrual basis increases nearing 20%. Same-store NOI grew by 2.6%, surpassing initial projections. Additionally, Piedmont's refinancing activity resulted in no debt maturities until 2028, despite increased net interest expenses impacting core FFO, which was reported at $1.49 per diluted share for the year. Looking ahead to 2025, Piedmont anticipates a leasing volume between 1.4 million to 1.6 million square feet, targeting a year-end lease percentage of 89% to 90%, and projecting same-store NOI growth of up to 3%. The guidance also includes expectations of higher interest expenses and manageable lease expirations, positioning the company to continue capturing market demand and driving rental rate growth.Piedmont Office Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Piedmont Office Expands Board with New Directors
Positive
Feb 27, 2025
On February 26, 2025, Piedmont Office Realty Trust appointed Jeffrey J. Donnelly, Deneen L. Donnley, and Stephen E. Lewis as directors, expanding its board to ten members. These appointments bring diverse expertise from the energy, legal, and hospitality sectors, potentially strengthening Piedmont’s strategic positioning and governance. The announcement, made on February 27, 2025, reflects Piedmont’s commitment to enhancing its leadership team with seasoned professionals, which could have positive implications for its operations and stakeholder relations.
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.