Canadian Apartment (CAR.UN) AI Stock Analysis

• Market Cap: C$6.74B
• Dividend Yield: 3.65%
• Average Volume (3M): 716.61K
• Price to Earnings (P/E): 23.9
• Beta (1Y): 0.96
• Revenue Growth: 4.45%
• EPS Growth: N/A
• Country: CA
• Employees: 992
• Sector: Real Estate
• Sector Strength: 69
• Industry: REITs
• EPS (TTM): 1.73
• Shares Outstanding: 160,764,050
• 10 Day Avg. Volume: 1,068,061
• 30 Day Avg. Volume: 716,605
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 6.30
• Price to Cash Flow (P/CF): 9.70
• P/FCF Ratio: 4.40
• 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: C$50.60
• Price Target Upside: 25.46% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

Canadian Apartment Properties REIT shows strong operational performance and strategic growth initiatives, reflected in high occupancy and rent growth. While financial stability is enhanced by cash-generating capabilities and equity position, high leverage remains a concern. The stock's valuation is moderate, and recent corporate actions bolster investor confidence. Despite some challenges, the overall outlook is positive.

Positive Factors

Distribution Increase

Management appears confident in the long-term FFO growth, and the Board of Trustees approved a 3.4% increase to the monthly distribution.

Portfolio Strategy

CAP REIT has been successful in its capital recycling strategy of divesting low-yielding assets or non-core property types and growing exposure to higher-quality apartment properties in larger Canadian rental apartment markets.

Negative Factors

Interest Expense

Greater interest expense from refinancing mortgage debt at higher interest rates offset a portion of the strong operating performance.

Canadian Apartment Business Overview & Revenue Model

Company Description

Canadian Apartment Properties Real Estate Investment Trust (CAPREIT) is one of Canada's largest residential landlords, specializing in the acquisition, ownership, and management of residential rental properties. As a Real Estate Investment Trust (REIT), CAPREIT operates across Canada and has a diverse portfolio that includes mid-tier to luxury apartments, townhomes, and manufactured home communities. The company aims to provide quality rental accommodations and excellent customer service to its residents while delivering stable returns to its investors.

How the Company Makes Money

CAPREIT generates revenue primarily through rental income from its extensive portfolio of residential properties. The company leases apartments, townhomes, and manufactured home sites to individuals and families, collecting monthly rent payments as its main source of revenue. CAPREIT also benefits from property value appreciation and strategic property acquisitions, which can enhance rental income through increased occupancy rates and rental rate adjustments. Additionally, the company may engage in ancillary services and fees related to property management, parking, and utilities, further contributing to its earnings. CAPREIT's revenue model is supported by its strategic focus on maintaining high occupancy rates, optimizing rental pricing, and efficient property management practices.

Canadian Apartment Financial Statement Overview

Summary

Canadian Apartment demonstrates steady revenue growth and strong cash-generating abilities. However, high leverage and instability in net income present challenges. The stable equity position is a positive, but reducing debt could further improve financial health.

Income Statement

The company has shown consistent revenue growth with a revenue increase of 4.5% in the latest year. The gross profit margin has remained strong, averaging around 60% over the years. However, the volatility in net income, particularly the negative net income in 2023, indicates potential profitability challenges. The absence of EBIT in the latest data may suggest operational restructuring.

Balance Sheet

The balance sheet reflects a stable equity position, with an equity ratio consistently above 50%. However, the debt-to-equity ratio is relatively high, indicating significant leverage. The company's total debt has decreased slightly over recent years, but the high leverage remains a risk factor.

Cash Flow

The cash flow statements reveal a positive trend in free cash flow growth, with a noticeable increase in 2024. Operating cash flow remains robust, showing the company's strong cash-generating capability. However, the free cash flow to net income ratio fluctuates, partly due to variations in net income.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.11B	1.07B	1.01B	933.14M	882.64M
	Gross Profit
672.03M	630.41M	592.44M	609.99M	578.17M
	EBIT
0.00	615.95M	728.11M	516.13M	553.58M
	EBITDA
552.38M	-274.86M	697.07M	541.37M	587.55M
	Net Income Common Stockholders
292.74M	-411.57M	13.64M	1.39B	925.93M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
146.76M	35.22M	51.68M	73.41M	121.72M
	Total Assets
15.58B	16.97B	17.74B	17.71B	15.50B
	Total Debt
6.04B	7.11B	7.01B	6.46B	5.56B
	Net Debt
5.90B	7.08B	6.97B	6.39B	5.44B
	Total Liabilities
6.55B	7.69B	7.74B	7.31B	6.23B
	Stockholders Equity
9.03B	9.28B	10.00B	10.40B	9.27B
Cash Flow		Free Cash Flow
399.04M	308.09M	261.56M	252.01M	236.50M
	Operating Cash Flow
648.85M	615.92M	598.03M	551.43M	481.36M
	Investing Cash Flow
1.74B	-138.47M	-502.97M	-1.11B	-1.02B
	Financing Cash Flow
-2.29B	-495.23M	-132.32M	512.50M	185.45M

Canadian Apartment Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 40.33
• 50DMA: Positive
• 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 TSE:CAR.UN, the sentiment is Neutral. The current price of 40.33 is below the 20-day moving average (MA) of 40.50, below the 50-day MA of 40.82, and below the 200-day MA of 45.49, indicating a neutral trend. The MACD of 0.06 indicates Negative momentum. The RSI at 51.37 is Neutral, neither overbought nor oversold. The STOCH value of 62.71 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:CAR.UN.

Canadian Apartment Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MRC	76 Outperform	$1.29B	5.04	6.46%	0.56%	-7.92%	256.12%
CAR.UN	71 Outperform	C$6.74B	23.91	3.20%	3.65%	4.45%	―
Sector *	61 Neutral	$4.74B	19.20	-3.02%	7.93%	6.43%	-20.98%

Canadian Apartment Corporate Events

CAPREIT Announces Increased February 2025 Distribution

CAPREIT has announced an increase in its February 2025 monthly distribution to $0.12916 per Unit, marking an annualized distribution of $1.55. This decision reflects CAPREIT’s ongoing commitment to enhancing shareholder value and maintaining its strong market presence in the real estate sector, as evidenced by its substantial portfolio and sustained growth in distributions.

CAPREIT Reports Robust 2024 Financial Results Amid Market Adjustments

CAPREIT announced strong financial and operating results for the fourth quarter and full year of 2024. Despite a decrease in the number of suites and sites and a slight decline in overall occupancy, the company reported increased operating revenues and net operating income compared to the previous year. The results underscore CAPREIT’s solid performance in adjusting to market conditions, with improved rental rates in both its Canadian and Dutch portfolios. The company’s financial health is reflected in its net income for the year, signaling a recovery from a loss recorded in the previous year, and a stable distribution per unit.

CAPREIT Enhances Portfolio with $194 Million in Strategic Transactions

CAPREIT has announced a strategic shift in its portfolio with the completion of key acquisitions and dispositions totaling $194 million. The company sold non-core assets in Brampton and Charlottetown while acquiring newly constructed rental properties in Vancouver and Edmonton. These transactions bolster CAPREIT’s presence in Western Canada, aligning with its strategy of upgrading its portfolio with properties that offer both value and growth potential. The moves are part of a broader capital reallocation plan aimed at enhancing the company’s core platform and supporting the Canadian housing market.

CAPREIT Announces Major Sales and Special Distributions

Canadian Apartment Properties Real Estate Investment Trust (CAPREIT) has successfully sold a portion of its manufactured home community portfolio for $715 million and plans to complete the sale of remaining lots in early 2025. The company also announced a special distribution from its European Residential Real Estate Investment Trust holdings, utilizing proceeds to repay debt and fund future acquisitions in Canada. Additionally, CAPREIT declared a special non-cash distribution to its Unitholders, reflecting capital gains realized throughout the year.

CAPREIT Announces $104 Million Montréal Sale

Canadian Apartment Properties Real Estate Investment Trust (CAPREIT) is set to sell a non-core portfolio of 717 residential suites in Montréal to the city for $103.8 million. This move supports the city’s affordable housing initiative and aligns with CAPREIT’s commitment to promoting affordable housing in Canada.