Plaza Retail REIT (PLZ.UN) AI Stock Analysis

Compare

173 Followers

TSE:PLZ.UN Dividends

Top Page

Plaza Retail REIT

(TSX:PLZ.UN)

76Outperform

Plaza Retail REIT's overall stock score of 76 reflects its robust financial performance, strong technical indicators, and attractive valuation, enhanced by positive earnings call insights. The company's strategic initiatives and high dividend yield contribute to its appeal as a stable investment in the retail REIT industry.

Positive Factors

Asset Management

Proceeds from asset sales have been effectively used to fund new development projects.

Leasing and Occupancy

Plaza renewed a significant amount of leases at favorable leasing spreads and improved portfolio occupancy to 97.6%.

Market Valuation

Plaza Retail REIT trades at a significant discount to its NAVPU estimate, which presents a compelling entry point for investors.

Negative Factors

Financial Performance

Funds from operations (FFO) per diluted unit was down 16% year-over-year and below consensus.

Financing Costs

Greater financing costs due to rising interest rates could impact the company's profitability, as the weighted average interest rate increased year-over-year.

Interest Expenses

Interest expenses increased due to the rise in interest rates, impacting overall financial performance.

Plaza Retail REIT (PLZ.UN) vs. S&P 500 (SPY)

Market Cap

C$412.99M

Dividend Yield7.49%

Average Volume (3M)59.04K

Price to Earnings (P/E)16.7

Beta (1Y)0.43

Revenue Growth5.99%

EPS Growth20.38%

CountryCA

Employees98

SectorReal Estate

Sector Strength77

IndustryREIT - Retail

Share Statistics

EPS (TTM)0.22

Shares Outstanding110,425,780

10 Day Avg. Volume36,272

30 Day Avg. Volume59,037

Financial Highlights & Ratios

PEG Ratio0.82

Price to Book (P/B)N/A

Price to Sales (P/S)3.43

Price to Cash Flow (P/CF)7.40

P/FCF Ratio0.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

C$4.19

Price Target Upside12.03% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering5

Plaza Retail REIT Business Overview & Revenue Model

Company DescriptionPlaza is an open-ended real estate investment trust and is a leading retail property owner and developer, focused on Ontario, Quebec and Atlantic Canada. Plaza's portfolio at September 30, 2020 includes interests in 272 properties totaling approximately 8.6 million square feet across Canada and additional lands held for development. Plaza's portfolio largely consists of open-air centres and stand-alone small box retail outlets and is predominantly occupied by national tenants.

How the Company Makes MoneyPlaza Retail REIT generates revenue primarily through leasing retail space to tenants, which include a mix of national, regional, and local retailers. The company collects rent from these tenants based on long-term lease agreements, which often include base rent and additional charges for common area maintenance and property taxes. Plaza Retail REIT's revenue is further supported by strategic property acquisitions, developments, and redevelopments that enhance the value of its portfolio. The REIT's earnings are also influenced by its ability to maintain high occupancy rates, negotiate favorable lease terms, and manage operational costs efficiently. By focusing on properties in well-located markets with strong demographics, Plaza Retail REIT aims to provide consistent returns to its investors.

Plaza Retail REIT Financial Statement Overview

Summary

Plaza Retail REIT exhibits stable financial health with moderate revenue growth and improved net profit margin. The balance sheet shows moderate leverage with a stable equity base, and effective cash flow management despite a slight decline in operating cash flow.

Income Statement

Positive

The income statement shows a moderate growth trend in revenue from 2023 to 2024 (6.34%). Gross profit margin is stable at around 61.3%. However, the absence of EBIT in 2024 is a concern, potentially impacting profitability analysis. The net profit margin improved slightly to 20.65% from 17.69% in 2023, indicating better cost management or revenue growth.

Balance Sheet

Positive

The balance sheet shows a stable equity position with a debt-to-equity ratio of approximately 1.22, indicating moderate leverage for a REIT. The equity ratio is 43.61%, reflecting a balanced asset structure. Return on equity increased to 4.63% in 2024, showing improved profitability relative to shareholder's equity.

Cash Flow

Positive

Cash flow analysis reveals a decline in operating cash flow from 2023 to 2024 by 5.74%, which may indicate operational challenges. However, free cash flow remains stable, showing effective capital expenditure management. The operating cash flow to net income ratio is 1.59, suggesting efficient cash generation relative to earnings.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
121.28M	114.06M	111.25M	110.63M	106.90M
	Gross Profit
74.36M	70.35M	70.58M	71.78M	68.75M
	EBIT
0.00	65.35M	55.07M	35.64M	35.51M
	EBITDA
57.32M	64.63M	81.34M	70.51M	64.48M
	Net Income Common Stockholders
25.05M	20.19M	53.89M	99.61M	-14.94M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
8.87M	10.87M	7.26M	8.06M	8.27M
	Total Assets
1.24B	1.26B	1.27B	1.21B	1.14B
	Total Debt
657.22M	672.47M	708.14M	679.24M	681.13M
	Net Debt
648.35M	661.60M	700.88M	671.18M	672.85M
	Total Liabilities
696.37M	714.49M	747.71M	716.94M	712.23M
	Stockholders Equity
540.82M	546.49M	518.90M	493.52M	422.41M
Cash Flow		Free Cash Flow
39.86M	42.29M	80.69M	69.39M	60.87M
	Operating Cash Flow
39.86M	42.29M	38.47M	48.21M	31.72M
	Investing Cash Flow
5.34M	-10.00M	-44.90M	-21.95M	-27.77M
	Financing Cash Flow
-23.29M	-40.23M	1.15M	-26.33M	-20.64M

Plaza Retail REIT Technical Analysis

Technical Analysis Sentiment

Positive

Last Price3.74

Price Trends

50DMA

3.68

Positive

100DMA

3.60

Positive

200DMA

3.61

Positive

Market Momentum

MACD

0.01

Negative

RSI

54.57

Neutral

STOCH

80.24

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:PLZ.UN, the sentiment is Positive. The current price of 3.74 is above the 20-day moving average (MA) of 3.69, above the 50-day MA of 3.68, and above the 200-day MA of 3.61, indicating a bullish trend. The MACD of 0.01 indicates Negative momentum. The RSI at 54.57 is Neutral, neither overbought nor oversold. The STOCH value of 80.24 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:PLZ.UN.

Plaza Retail REIT Peers Comparison

Overall Rating

UnderperformOutperform

Sector (59)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PLZ.UN	76 Outperform	C$412.99M	16.65	4.61%	7.49%	5.99%	20.38%
SRU.UN	76 Outperform	C$4.33B	18.94	4.50%	7.28%	9.46%	-42.77%
CRR.UN	72 Outperform	C$2.69B	―	-0.22%	6.10%	8.82%	92.79%
Sector *	59 Neutral	$2.72B	11.59	0.11%	8770.69%	5.44%	-16.52%

* Real Estate Sector Average

Performance Comparison

TSE:PLZ.UN

Plaza Retail REIT

3.74

0.48

14.72%

RIOCF

RioCan Real Estate Investment

12.38

0.22

1.81%

TSE:CRR.UN

Crombie Real Estate ate

14.60

2.67

22.38%

TSE:SRU.UN

SmartCentres Real Estate Investment Trust

25.40

4.61

22.17%

DRETF

Dream Office Real Estate Investment

11.44

-1.86

-13.98%

APYRF

Allied Properties Real Estate Investment Trust

11.22

-0.07

-0.62%

Plaza Retail REIT Earnings Call Summary

Earnings Call Date: Feb 26, 2025 | % Change Since: 2.19% | Next Earnings Date: May 7, 2025

Earnings Call Sentiment Positive

The earnings call highlighted strong financial performance with record NOI growth, successful lease renewals, strategic development projects, and effective capital recycling. However, it also acknowledged challenges such as reorganization costs, enclosed mall performance, and property write-downs. Overall, the positive aspects outweighed the negatives, indicating a robust financial position and strategic progress.

Highlights

Record Same-Asset NOI Growth

Plaza Retail REIT achieved record same-asset NOI growth of 4.8% for the quarter and 3.4% for the year due to asset repositioning and strong leasing spreads.

Exceptional Lease Renewal Spreads

Lease renewal spreads averaged 7.4%, or 11.8% excluding a specific theater tenant, demonstrating strong tenant demand and successful leasing strategies.

Successful Capital Recycling Program

The 2024 capital recycling program was successful in increasing property size, reducing asset age, and enhancing overall portfolio quality.

Strong Financial Metrics

Total NOI for the quarter increased by 8.5% over the previous year, with annual growth at 6.6%. Excluding reorganization costs, FFO per unit for the quarter was nearly 11% higher, and AFFO was 31% higher.

High Occupancy Rates and Strategic Footprint Expansion

Record occupancy rates and strategic expansion into known markets have positioned Plaza at the forefront of the retail sector in Eastern Canada.

New Development in Welland, Ontario

Launched construction of a new development project in Welland, Ontario, which will feature 100,000 square feet of retail space anchored by a 35,000 square foot grocery tenant.

Lowlights

Reorganization Costs Impact

Incurred $2.6 million in reorganization costs during the quarter for severances and write-offs of potential development projects that will not be pursued.

Enclosed Malls Impact on Portfolio

Enclosed malls, comprising 3% of NOI, may not significantly impact same-property NOI outlook, but optimization and leasing of vacant space are needed to maximize incremental NOI.

Write-Down of Investment Properties

A year-to-date write-down of $10.4 million in investment properties due to updated appraisals, despite a $1.8 million write-up during the quarter.

Company Guidance

During the Plaza Retail REIT Fourth Quarter 2024 Earnings Conference Call, several key financial metrics and strategic achievements were discussed. The company reported record same-asset NOI growth and lease renewal spreads, with an average leasing spread of 7.4% over the real term, which would have been 11.8% excluding a specific renewal. Plaza's total NOI for the quarter increased by 8.5% compared to the previous year, with annual NOI up by 6.6%. The company's efforts to enhance its portfolio through development projects and the sale of non-core properties contributed to an increase in per unit FFO and AFFO, which would have been 11% and 31% higher, respectively, excluding reorganization costs. Plaza's debt-to-assets ratio was 50.6%, and their net debt to EBITDA was 8x, showing a decrease from the previous year. The company undertook a successful capital recycling program with non-core asset sales at a weighted average cap rate of approximately 6%, enhancing liquidity to $69 million. These efforts reflect Plaza's strategic focus on optimizing and intensifying its existing portfolio while maintaining strong operational and financial performance.

Plaza Retail REIT Corporate Events

Financial Disclosures

Plaza Retail REIT to Discuss Q1 2025 Financial Results in Upcoming Conference Call

Neutral

Apr 23, 2025

Plaza Retail REIT has announced a conference call scheduled for May 8, 2025, to discuss its first quarter financial results for 2025. The financial statements and management’s discussion and analysis will be available prior to the call on Plaza’s website and SEDAR+. This announcement is significant for stakeholders as it provides an opportunity to gain insights into the company’s financial performance and strategic direction, potentially impacting its market positioning and investor confidence.

Spark’s Take on TSE:PLZ.UN Stock

According to Spark, TipRanks’ AI Analyst, TSE:PLZ.UN is a Outperform.

Plaza Retail REIT’s overall stock score of 76 reflects its robust financial performance, strong technical indicators, and attractive valuation, enhanced by positive earnings call insights. The company’s strategic initiatives and high dividend yield contribute to its appeal as a stable investment in the retail REIT industry.

To see Spark’s full report on TSE:PLZ.UN stock, click here.

DividendsBusiness Operations and Strategy

Plaza Retail REIT Declares April 2025 Distribution

Positive

Apr 16, 2025

Plaza Retail REIT announced its April 2025 monthly distribution of $0.02333 per unit, which annualizes to $0.28. This distribution will be payable on May 15, 2025, to unitholders recorded by April 30, 2025. This announcement reflects Plaza’s ongoing commitment to providing consistent returns to its investors, reinforcing its stable position within the retail real estate market. The focus on essential needs and value-oriented retail properties positions Plaza favorably in the current economic climate, potentially benefiting stakeholders through sustained occupancy and rental income.

Spark’s Take on TSE:PLZ.UN Stock

According to Spark, TipRanks’ AI Analyst, TSE:PLZ.UN is a Outperform.

Plaza Retail REIT demonstrates solid financial performance, with stable revenue growth and effective cash management. The technical indicators support a positive outlook with strong upward momentum. The valuation metrics suggest a reasonable but not exceptional investment opportunity, balanced by a high dividend yield. The recent earnings call reinforced confidence in the company’s strategic direction despite certain operational challenges.

To see Spark’s full report on TSE:PLZ.UN stock, click here.

Dividends

Plaza Retail REIT Declares March 2025 Distribution

Positive

Mar 17, 2025

Plaza Retail REIT announced its March 2025 monthly distribution of $0.02333 per unit, payable on April 15, 2025, to unitholders of record as of March 31, 2025. This announcement reflects Plaza’s ongoing commitment to providing consistent returns to its investors, reinforcing its strong position in the retail property sector across Canada.

Business Operations and StrategyFinancial Disclosures

Plaza Retail REIT Reports Robust 2024 Financial Results

Positive

Feb 27, 2025

Plaza Retail REIT reported strong financial results for 2024, showcasing record growth in same-asset net operating income (NOI) and lease renewal spreads, alongside high occupancy rates. The company’s strategic portfolio improvements, including development projects and the sale of non-core assets, have enhanced its resilience against macroeconomic challenges. The financial performance was bolstered by increased leasing revenue and rent escalations, although impacted by administrative costs related to reorganization and development project write-offs. Overall, Plaza’s robust results reflect its well-positioned portfolio in the retail real estate market.

DividendsBusiness Operations and Strategy

Plaza Retail REIT Announces February 2025 Distribution

Positive

Feb 18, 2025

Plaza Retail REIT has announced its February 2025 monthly distribution of $0.02333 per unit, which will be paid to unitholders on March 17, 2025. This announcement highlights Plaza’s ongoing commitment to providing value to its stakeholders, maintaining its position in the retail property industry, and reinforcing its focus on essential needs and convenience segments, which are crucial for its market strategy.

Financial Disclosures

Plaza Retail REIT Schedules Year-End 2024 Financial Results Call

Positive

Feb 3, 2025

Plaza Retail REIT announced its year-end 2024 financial results conference call scheduled for February 27, 2025, where senior management will discuss the company’s financial outcomes. The financial statements and analysis will be available prior to the call, indicating Plaza’s commitment to transparency and stakeholder engagement, potentially influencing its market position positively.

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.