The Necessity Retail REIT, Inc.

NasdaqGS:RTL Rapport sur les actions

Capitalisation boursière : US$1.0b

This company has been acquired

The company may no longer be operating, as it has been acquired. Find out why through their latest events.

Necessity Retail REIT Croissance future

Future contrôle des critères 0/6

Necessity Retail REIT devrait augmenter ses bénéfices et ses revenus de 22.2% et 0.6% par an respectivement.

Informations clés

22.2%

Taux de croissance des bénéfices

n/a

Taux de croissance du BPA

Retail REITs croissance des bénéfices-1.9%
Taux de croissance des recettes0.6%
Rendement futur des capitaux propresn/a
Couverture par les analystes

Low

Dernière mise à jour16 Aug 2023

Mises à jour récentes de la croissance future

Recent updates

Seeking Alpha • Oct 19

Necessity Retail REIT: Significantly Undervalued Despite Strong FFO

Summary Necessity Retail owns and operates well-diversified properties and has a substantially strong financial position. Recently, stocks have pulled back to a lower level and are trading at about 6 times its FFO. Acquisition of CMI group has led to an all-time high FFO in the recent quarter, but due to the current adverse economic conditions faced by the retail REIT industry, the stock has become substantially undervalued. According to the earnings forecast, dividend yield per share for the year FY2022 will exceed 14%. Necessity Retail (RTL) is a real estate investment trust which operates diversified retail and office real estate; since its inception in 2013, the company has acquired substantial properties over the period. It currently owns 1056 properties, accounting for about 28.9 million rentable square feet, which includes 944 single-tenant net-leased commercial properties and 112 multi-tenant retail properties. Currently, about 90.8% of the company's portfolio is leased. The company is managed by a third-party advisor and over the period, management has taken many vital decisions which have created good value for the shareholders. RTL is financially stable and has a substantially diversified tenant base, which provides consistent solid rental income. Along with that, it has substantial liquidity with no significant near-term debt maturity except $289 million due in FY2023, which according to management, will be reduced soon through the strategic disposition of the company's underperforming properties. The investor should also note that RTL has a strong cash flow and consistent dividend payment history. Even in the adverse condition of FY2020, the company paid substantial dividends. Even in the current adverse economic conditions for REITs, where some REIT operators, such as Pennsylvania Real Estate Investment Trust (PEI), have filed for bankruptcy, RTL has been producing record-high revenue and FFO. But due to the inflationary environment and the trouble faced by retail REITs, the company's stock has been dropping and over time has become substantially undervalued; I believe the stock has a substantial upward potential at this price. Historical performance Since its inception, management has focused on acquiring primarily net leased and single-tenant service retail properties, but in December 2021, management changed its focus towards multi-tenant retail centers and signed a purchase agreement to acquire 79 multi-tenant retail centers and two single-tenant properties (CIM portfolio) for $1.3 billion; as a result, over the last few quarters debt levels have increased significantly with substantial equity dilution. As a REIT company has to pay over 90% of its taxable income through dividends, therefore debt and equity dilutions remain a significant source for the REIT to grow its operations during adverse economic conditions; if REIT fails to generate adequate cash, then it has to rely on debt and equity dilution to maintain its operations and during those periods raising funds becomes so expensive and challenging which further puts significant pressure on the company's financials, hence to analyze company's past performance in various economic conditions becomes so important to assess the overall risk. Financials (in million dollars) (Author) Due to consistent acquisitions, over the period, the company's revenue has increased substantially, it is appreciated that even in the adverse condition of FY2020, the company could generate substantial FFO and has been paying out significant cash flow as a dividend, which reflects that the company could sustain its FFO even in adverse economic conditions, also note that the company has a strong record of dividend payments. Debt and equity financing Historically, the company had substantially high-interest rates on its debt facilities, but with time, due to its strong balance sheet and a well-diversified portfolio, RTL could obtain financial debt at a reasonable cost. Over the last two years, debt has increased significantly, primarily due to strategic acquisitions to expand the property base and add high-yielding rental properties. Also, note that recently borrowed debt has more attractive interest rates than the historical level. Debt Maturity (Annual Report) In the current adverse economic environment, many retail REIT operators are facing considerable problems in renewing debt facilities. Some REIT operators have filed for bankruptcy because of their inability to comply with debt maturities, but in the case of Necessity Retail, there is no significant debt maturity till 2025, except for $289 million due in FY2023, which according to management will be reduced soon through the strategic disposition of the company's underperforming properties. Investors should also consider that management has strategically reduced the effect of interest rate fluctuation by locking interest rates at reasonable levels; currently, about 83% of the company's total debt has fixed interest rates, which has enabled the company to keep interest rates at moderate levels when the overall interest rates in the United States are hiked due to an inflationary environment. Strength in the business model Having a much stronger customer base and a well-diversified tenant portfolio gives the business model substantial strength even in adverse economic conditions. Diversified tenant base Tenant Portfolio (Investor Presentation) The significant risk for REITs lies in their customer concentration; if these high revenue contributing leases goes bankrupt, REIT's ability to comply with financial obligations affects severely, which leads to significant deterioration in shareholder value, but in the case of RTL, the tenant base is substantially diversified amongst the various industries, which helps the company to earn stable rental earnings even in adverse economic conditions. Well-balanced lease maturity Lease Maturity Schedule (Investor Presentation) RTL has a well-balanced lease maturity with a weighted average remaining term of 7.3 years, which will produce significant rental income for a more extended period. Also, RTL doesn't have any considerable lease expiry in the next two years, majority of the company's contracts are for the much longer term, which will help the company produce good cash flows even if the current economic situation takes longer time to recover, but the investor must concern that, during recessionary environment, many retailers can go bankrupt, which might affect the company's rental income and cash flows. Strong customer base Investment Grade Tenant (Investor Presentation) RTL has a strong and solvent customer base with substantially good investment ratings by Moody's; approximately 57.9% of tenants in the single-tenant portfolio were considered "investment grade," and about 30.0% of the anchor tenants in the multi-tenant portfolio were considered "investment grade." Along with it, the company has a higher percentage of investment grade, service-oriented tenets compared to its peers, reflecting that the management's approach towards selecting tenets is extremely conservative compared to its peers. Due to management's conservative approach in selecting tenets, the company's portfolio remains free of tenant bankruptcies even when the other retail property owners are facing a lot of trouble. Second quarter highlights Quarterly Income Statement (Annual Report)
Seeking Alpha • Oct 03

Necessity Retail REIT declares $0.2125 dividend

Necessity Retail REIT (NASDAQ:RTL) declares $0.2125/share quarterly dividend, in line with previous. Forward yield 14.46% Payable Oct. 17; for shareholders of record Oct. 13; ex-div Oct. 12. See RTL Dividend Scorecard, Yield Chart, & Dividend Growth.
Seeking Alpha • Aug 18

Necessity Retail REIT: 10% Yield, 40% Upside, Deep In Debt

Net Lease REITs are the third-best performing REIT sector so far this year. Necessity Retail has not kept pace with Net Lease REITs, but its 4.99% total return has widely outpaced the VNQ thus far. This 10% yielder has 40% upside, according to Wall Street analysts. Management went on an epic buying spree in the first half, financing it with debt and share issuance. This article examines growth, balance sheet, dividend, and valuation metrics for this small-cap REIT. Net Lease REITs are the third-best performing REIT sector so far this year. According to Hoya Capital Income Builder, Net Lease REITs as a whole have returned a gain of +1.13% YTD, while the Equity REIT average shows a loss of (-12.32)%. Hoya Capital Income Builder Necessity Retail's (RTL) 4.99% total return has outpaced the Net Lease REIT sector as well as the VNQ thus far. RTL Total Return Level data by YCharts What is the secret of this company's success, and is it likely to continue? Meet the company Necessity Retail Founded in 2013 and headquartered in New York, Necessity Retail is a small-cap Net Lease REIT, with a market cap of $1.07 billion. The company owns 1,057 properties in 48 U.S. states, with just 90.9% occupancy, earning $389 million per year in SLR (straight-line rent), on leases with a remaining average term of 7.2 years. RTL is externally managed by AR Global, which also manages mousetrap REIT Global Net Lease (GNL). RTL divides its portfolio into 4 segments: Single-Tenant portfolio (48% of SLR), rented long term to primarily stable investment grade tenants, this segment includes 941 properties, comprising 12.3 million square feet, with occupancy of 95.7% (much higher than the total portfolio average), 9.9-year average remaining lease term, 81% leased to retail and 17% leased to industrial tenants. Power Center portfolio (28% of SLR) anchored by national brand retailers. Anchored Center portfolio (13% of SLR) featuring multiple big box stores. Grocery Center portfolio (11% of SLR), anchored by grocery stores and highly resistant to economic downturns due to necessity-driven and in-person nature of grocery shopping. RTL website The Power, Anchored, and Grocery-centered segments, also known as the "open-air portfolio," combine for 113 properties across just 29 states, with 17.0 million square feet, and occupancy of just 87.6%. Only 41% of the tenant are investment grade, and average remaining lease term much shorter, at 4.6 years. However, these three segments still account for 52% of SLR when combined. Management aims to raise occupancy by about 5%, to the low-to-mid 90's. The overall tenant base is appropriately diversified, with the top customer (Trust Bank) accounting for just 3.9% of SLR, and the top 10 together contributing just under 30%. Tenants include many well-recognized national brands. RTL website RTL is highly diverse geographically. Although 57% of SLR comes from the Sunbelt, the balance is spread all across the country, especially in dense suburbs with "community-centric lifestyles." The heaviest concentration is in Georgia, which accounts for only 10% of SLR. RTL website Tenants are also highly diverse by industry. Out of 44 industries represented in the tenant base, gas/convenience stores lead the way at just 8% of SLR, followed by discount and specialty retailers, at 7% each. RTL website The company's acquisition strategy focuses on: Credit-worthy tenants with robust unit-level financial metrics and competitive advantages in sustainable industries, and Locations that serve as a central neighborhood destination for nearby residents, In secondary U.S. markets with strong growth profiles and demographics. For their single-tenant segment, they seek service-oriented retail properties. For the open-air segment, they look for necessity-based and downturn-resistant retail. Management went on a buying spree in H1, adding 79 multi-tenant properties to the open-air segment, and 12 single-tenant properties. The open-air center acquisitions cost a staggering $1.3 billion, growing the company's total square footage by about 10 million, an increase of 45%. Quarterly results Here are the Q2 highlights, according to the company's 10-Q for Q2 2022: Revenue from tenants was up 43.3% YoY (year-over-year), at $116.9 million. Operating expenses exploded by 144% YoY, to $153.5 million. Property operating expense more than doubled to $27.5 million, G&A expense more than doubled to $8.4 million, and the company showed a huge leap in "impairment of real estate investments," from $91 thousand to $59 million. This impairment charge reflected the company's decision to remove from their books a property in Minnesota that they intend to sell. Once interest expenses are added in, the company lost $50.5 million in Q2, compared to a loss of "only" $1.5 million in Q2 2021. Net loss per share was (-$0.43), compared to (-$0.07) in Q2 2021. RTL increased share count by 19.6% over the past 12 months. Net cash from operations was $104.6 million, up 60% YoY. Total capex $1.8 million, down from $4.4 million YoY. Same-store NOI of $16.5 million, down 13.5% YoY. Newly-acquired stores posted $21.1 million in NOI. FFO of $35.7 million, up 42.6% YoY, thanks to acquisitions. FFO per share $0.27, up 17.4% YoY. Completed acquisition of $1.3 billion worth of open-air shopping centers. For the first half of 2022, these are the highlights: Revenue from tenants of $211.9 million, up 31.8% YoY. Net operating income of $44.2 million, up 28.5% YoY Net loss of (-$4.65) million, compared to (-$5.24) million in H1 2021, after factoring in interest expense. Net loss per share of (-$0.13), compared to (-$0.16) in H1 2021. Share count increased by 19.1% YoY. Total assets of $4.7 billion, up sharply from $3.8 billion YoY. Total capex $5.2 million, down from $6.8 million YoY. Base rent revenues in 2023 will be $353 million, tapering off each year to just $223 million by 2027. Company 10-Q for Q2 2022 Rent collections for RTY were hit hard during the 2020 pandemic, but have recovered to 99% as of Q2. Growth metrics Here are the 3-year growth figures for FFO (funds from operations), TCFO (total cash from operations), and market cap. Metric 2019 2020 2021 2022* 3-year CAGR FFO (millions) $98.6 $97.0 $97.3 $137.2 -- FFO Growth % -- (-1.6) 0.0 41.0 11.6% FFO per share $0.93 $0.90 $0.83 $1.03 -- FFO per share growth % -- (-3.2) (-7.8) 24.1 3.5% TCFO (millions) $105.6 $92.7 $145.3 $210.0 -- TCFO Growth % -- (-12.2) 57.7 44.5 25.75% *Projected, based on H1 2022 results Source: TD Ameritrade, CompaniesMarketCap.com, and author calculations The picture above tells a clear story. Of course, like all retail, RTY was hit by COVID, but because of the essential nature of its stores, the setback to FFO was relatively mild, and the 41% surge this year results in double-digit 3-year growth. But FFO/share is another matter, lagging FFO every year, and growing by only 3.5% as an annual average. This means the company is issuing new shares faster than it is growing revenue. Meanwhile, cash flow took a hit in 2020, but has roared back in each of the last two years at phenomenal rates. Meanwhile, here is how the stock price has done over the past 3 twelve-month periods, compared to the REIT average as represented by the Vanguard Real Estate ETF (VNQ). Metric 2019 2020 2021 2022 3-yr CAGR RTY share price Aug. 15 $12.24 $7.45 $8.57 $8.02 -- RTY share price Gain % -- (-39.1) 15.0 (-6.4) (-13.14)% VNQ share price $90.25 $81.15 $106.76 $102.26 -- VNQ share price Gain % -- (-10.1) 31.6 (-4.2) 4.25% Source: MarketWatch.com and author calculations RTY's share price has underperformed the VNQ in each of the past 3 years. Investors have seen an average annual loss of (-13.14)%, compared to the VNQ's plodding 4.25% gain. RTY's superior dividend yield does not cover that 17.4% gap. It has been a mousetrap of significant proportions. Balance sheet metrics Here are the key balance sheet metrics, and this is where RTY presents the greatest cause for concern for investors. Company Liquidity Ratio Debt Ratio Debt/EBITDA Bond Rating RTL 1.58 55% 17.4 BB Source: Hoya Capital Income Builder, TD Ameritrade, and author calculations The company's Liquidity Ratio of 1.58 is down considerably from the 1.81 mark they held at the close of 2021. The company's total debt for mortgage notes, senior notes, and credit facility loans comes to $2.75 billion as of June 30. The weighted average interest rate is 3.8%. RTL's weighted average debt maturity is 4.6 years, and 83% of its total debt is fixed rate. The company has cash and equivalents of $87 million through Q2, down from $237 million in H1 2021, despite a $390 million jump in cash from financing in H1 2022. Cash from investments netted (-$686 million) in H1, nearly 10 times the outflow in H1 2021. Total liquidity, including undrawn available credit, stood at just $108 million on June 30.
Seeking Alpha • Aug 03

Necessity Retail REIT FFO of $0.27 beats by $0.01, revenue of $116.9M beats by $14.44M

Necessity Retail REIT press release (NASDAQ:RTL): Q2 FFO of $0.27 beats by $0.01. Revenue of $116.9M (+43.3% Y/Y) beats by $14.44M.
Seeking Alpha • Jul 01

Necessity Retail REIT declares $0.2125 dividend

Necessity Retail REIT (NASDAQ:RTL) declares $0.2125/share quarterly dividend, in line with previous. Forward yield 11.68% Payable July 15; for shareholders of record July 11; ex-div July 8. See RTL Dividend Scorecard, Yield Chart, & Dividend Growth.
Seeking Alpha • Jun 08

Necessity Retail REIT: High Yield, Low Debt, Longer-Term Investment

An ATM program for RTL’s equity and preference shares is in existence for the past 3 years, which has demotivated investors to a large extent. RTL’s portfolio of service-oriented and traditional retail and distribution-related commercial real estate properties has high occupancy rates. Soon after the shares of RTL started effectively trading in the market, it has been generating a double-digit dividend yield.
Seeking Alpha • Mar 28

Necessity Retail REIT: 11% Yield But We Prefer The Preferreds

We had a trade on common shares of The Necessity Retail REIT when we last covered it. We had also suggested that the preferred shares offered one of the most resilient choices in that universe. We go over where we stand with both today.
Seeking Alpha • Dec 09

American Finance Trust: A Good Risk-Reward Setup

We last covered American Finance Trust and told you why we thought the preferred shares had merit. We go over some more recent developments and explain how that has validated our thinking. The preferred shares remain a rare strong piece of high yield in this market that we can get behind.
Seeking Alpha • Sep 22

American Finance: Preferred Shares Offer Good Buffer For Rising Rates

American Finance Trust is a triple net REIT offering a high dividend yield. The preferred shares though have a very large buffer from an asset coverage and FFO coverage. We explore the value of paying over par for these today.
Seeking Alpha • Sep 11

American Finance Trust: 7.375% Shares Are Still Attractive Thanks To Superior Dividend And Asset Coverage Ratio

American Finance Trust's preferred shares are in good shape thanks to AFIN's strong balance sheet and FFO. AFIN continues to sell its own shares (and preferred shares) on the market, which further boosts the equity side of its balance sheet. I own AFINO and I'm not chasing the stock here as I already have a full position, but I would for sure add on weakness.
Article d’analyse • Feb 20

What Type Of Returns Would American Finance Trust's(NASDAQ:AFIN) Shareholders Have Earned If They Purchased Their SharesYear Ago?

While not a mind-blowing move, it is good to see that the American Finance Trust, Inc. ( NASDAQ:AFIN ) share price has...

Prévisions de croissance des bénéfices et des revenus

NasdaqGS:RTL - Estimations futures des analystes et données financières antérieures (USD Millions )
DateRecettesLes revenusFlux de trésorerie disponibleCash from OpMoy. Nombre d'analystes
12/31/2025461-90N/AN/A1
12/31/2024451-110N/AN/A3
12/31/2023436-133N/AN/A2
6/30/2023455-1635894N/A
3/31/2023465-166101128N/A
12/31/2022446-107135155N/A
9/30/2022411-115162176N/A
6/30/2022386-64170184N/A
3/31/2022351-15140156N/A
12/31/2021335-64132145N/A
9/30/2021330-32111123N/A
6/30/2021316-34100109N/A
3/31/2021310-4896103N/A
12/31/2020305-478493N/A
9/30/2020304-438697N/A
6/30/2020299-3991103N/A
3/31/2020303-993109N/A
12/31/2019300-492106N/A
9/30/2019299-128899N/A
6/30/2019301-367690N/A
3/31/2019293-568291N/A
12/31/2018291-378595N/A
9/30/2018288-4389101N/A
6/30/2018283-3196107N/A
3/31/2018284-2097108N/A
12/31/2017271-468492N/A
9/30/2017243-637882N/A
6/30/2017218-567678N/A
3/31/2017191-59N/A62N/A
12/31/2016178-54N/A73N/A
9/30/2016177-32N/A75N/A
6/30/2016176-34N/A78N/A
3/31/2016175-32N/A82N/A
12/31/2015174-21N/A89N/A
9/30/2015173-3N/A98N/A
6/30/201517210N/A107N/A
3/31/201517112N/A107N/A
12/31/2014158-2N/A100N/A
9/30/2014140-12N/A70N/A
6/30/201499-31N/A28N/A
3/31/201457-32N/A6N/A
12/31/201326-23N/A-15N/A

Prévisions de croissance des analystes

Taux de revenus par rapport au taux d'épargne: RTL devrait rester non rentable au cours des 3 prochaines années.

Bénéfices vs marché: RTL devrait rester non rentable au cours des 3 prochaines années.

Croissance élevée des bénéfices: RTL devrait rester non rentable au cours des 3 prochaines années.

Chiffre d'affaires vs marché: Le chiffre d'affaires de RTL ( 0.6% par an) devrait croître plus lentement que le marché de US ( 11.7% par an).

Croissance élevée des revenus: Le chiffre d'affaires de RTL ( 0.6% par an) devrait croître plus lentement que 20% par an.

Prévisions de croissance du bénéfice par action

Rendement futur des capitaux propres

ROE futur: Données insuffisantes pour déterminer si le retour sur capitaux propres de RTL devrait être élevé dans 3 ans

Découvrir les entreprises en croissance

7D

1Y

7D

1Y

7D

1Y

Analyse de l'entreprise et données financières

DonnéesDernière mise à jour (heure UTC)
Analyse de l'entreprise2023/09/13 09:10
Cours de l'action en fin de journée2023/09/11 00:00
Les revenus2023/06/30
Revenus annuels2022/12/31

Sources de données

Les données utilisées dans notre analyse de l'entreprise proviennent de S&P Global Market Intelligence LLC. Les données suivantes sont utilisées dans notre modèle d'analyse pour générer ce rapport. Les données sont normalisées, ce qui peut entraîner un délai avant que la source ne soit disponible.

PaquetDonnéesCadre temporelExemple de source américaine *
Finances de l'entreprise10 ans
  • Compte de résultat
  • Tableau des flux de trésorerie
  • Bilan
Estimations consensuelles des analystes+3 ans
  • Prévisions financières
  • Objectifs de prix des analystes
Prix du marché30 ans
  • Cours des actions
  • Dividendes, scissions et actions
Propriété10 ans
  • Actionnaires principaux
  • Délits d'initiés
Gestion10 ans
  • L'équipe dirigeante
  • Conseil d'administration
Principaux développements10 ans
  • Annonces de l'entreprise

* Exemple pour les titres américains ; pour les titres non américains, des formulaires réglementaires et des sources équivalentes sont utilisés.

Sauf indication contraire, toutes les données financières sont basées sur une période annuelle mais mises à jour trimestriellement. C'est ce qu'on appelle les données des douze derniers mois (TTM) ou des douze derniers mois (LTM). En savoir plus.

Modèle d'analyse et flocon de neige

Les détails du modèle d’analyse utilisé pour générer ce rapport sont disponibles sur notre page Github; nous proposons également des guides expliquant comment utiliser nos rapports et des tutoriels sur Youtube.

Découvrez l'équipe de classe mondiale qui a conçu et construit le modèle d'analyse Simply Wall St.

Indicateurs de l'industrie et du secteur

Nos indicateurs de secteur et de section sont calculés toutes les 6 heures par Simply Wall St. Les détails de notre processus sont disponibles sur Github.

Sources des analystes

The Necessity Retail REIT, Inc. est couverte par 5 analystes. 3 de ces analystes ont soumis les estimations de revenus ou de bénéfices utilisées comme données d'entrée dans notre rapport. Les soumissions des analystes sont mises à jour tout au long de la journée.

AnalysteInstitution
Brian HollendenAegis Capital Corporation
Bryan MaherB. Riley Securities, Inc.
Mitchell GermainCitizens JMP Securities, LLC