TSX:SMU.UN

Stock Analysis Report

Summit Industrial Income REIT

Executive Summary

Summit Industrial Income REIT is an unincorporated open-end trust focused on growing and managing a portfolio of light industrial and other properties across Canada.

Snowflake

Fundamentals

Reasonable growth potential second-rate dividend payer.

Share Price & News

How has Summit Industrial Income REIT's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

-1.8%

SMU.UN

-1.1%

CA REITs

-0.3%

CA Market


1 Year Return

47.6%

SMU.UN

18.4%

CA REITs

0.9%

CA Market

Return vs Industry: SMU.UN exceeded the Canadian REITs industry which returned 18.4% over the past year.

Return vs Market: SMU.UN exceeded the Canadian Market which returned 0.9% over the past year.


Share holder returns

SMU.UNIndustryMarket
7 Day-1.8%-1.1%-0.3%
30 Day6.5%4.2%-2.1%
90 Day0.7%6.4%-1.5%
1 Year55.5%47.6%24.9%18.4%4.4%0.9%
3 Year153.0%108.6%40.7%18.5%15.7%5.4%
5 Year211.8%117.3%68.8%25.7%26.1%7.9%

Price Volatility Vs. Market

How volatile is Summit Industrial Income REIT's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Summit Industrial Income REIT undervalued based on future cash flows and its price relative to the stock market?

43%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Undervalued: SMU.UN (CA$13.08) is trading below our estimate of fair value (CA$22.88)

Significantly Undervalued: SMU.UN is trading below fair value by more than 20%.


Price Based on Earnings

PE vs Industry: SMU.UN is poor value based on its PE Ratio (27.1x) compared to the REITs industry average (9.6x).

PE vs Market: SMU.UN is poor value based on its PE Ratio (27.1x) compared to the Canadian market (13.7x).


Price Based on Expected Growth

Low PEG Ratio: Insufficient data to calculate SMU.UN's PEG Ratio to determine if it is good value.


Price Based on Value of Assets

PB vs Industry: SMU.UN is overvalued based on its PB Ratio (1.5x) compared to the CA REITs industry average (1x).


Next Steps

Future Growth

How is Summit Industrial Income REIT expected to perform in the next 1 to 3 years based on estimates from 2 analysts?

14.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Earnings vs Savings Rate: SMU.UN's forecast earnings growth (14.2% per year) is above the savings rate (1.9%).

Earnings vs Market: SMU.UN's earnings (14.2% per year) are forecast to grow faster than the Canadian market (13.3% per year).

High Growth Earnings: SMU.UN's earnings are forecast to grow, but not significantly.

Revenue vs Market: SMU.UN's revenue (23.6% per year) is forecast to grow faster than the Canadian market (5.7% per year).

High Growth Revenue: SMU.UN's revenue (23.6% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Estimates


Future Return on Equity

High Future ROE: Insufficient data to determine if SMU.UN's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Summit Industrial Income REIT performed over the past 5 years?

53.6%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: SMU.UN's earnings have grown significantly by 53.6% per year over the past 5 years.

Accelerating Growth: SMU.UN's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: SMU.UN had negative earnings growth (-69.6%) over the past year, making it difficult to compare to the REITs industry average (6%).


Return on Equity

High ROE: SMU.UN's Return on Equity (4.4%) is considered low.


Return on Assets

ROA vs Industry: SMU.UN's Return on Assets is below or equal to the REITs industry average last year.


Return on Capital Employed

ROCE Improving: SMU.UN's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Summit Industrial Income REIT's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: SMU.UN has a high level of physical assets or inventory.

Debt Coverage by Assets: SMU.UN's debt is not covered by short term assets (assets are 0x debt).


Financial Institutions Analysis

Asset Level: SMU.UN's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if SMU.UN has a sufficient allowance for bad loans.

Low Risk Liabilities: SMU.UN reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if SMU.UN has an acceptable proportion of non-loan assets held.

Low Risk Deposits: SMU.UN has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if SMU.UN has an appropriate level of bad loans.


Next Steps

Dividend

What is Summit Industrial Income REIT's current dividend yield, its reliability and sustainability?

4.17%

Expected Dividend Yield


Dividend Yield vs Market

company4.1%marketbottom25%2.0%markettop25%6.0%industryaverage5.5%forecastin3Years4.2%

Current dividend yield vs market & industry


Dividend Yield and Payments Analysis

Notable Dividend: SMU.UN's dividend (4.13%) is higher than the bottom 25% of dividend payers in the Canadian market (2.03%).

High Dividend: SMU.UN's dividend (4.13%) is low compared to the top 25% of dividend payers in the Canadian market (5.98%).

Stable Dividend: SMU.UN's dividend payments have been volatile in the past 10 years.

Growing Dividend: SMU.UN's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (75.3%), SMU.UN's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: SMU.UN's dividends in 3 years are forecast to be thoroughly covered by earnings (0.6% payout ratio).


Next Steps

Management

What is the CEO of Summit Industrial Income REIT's salary, the management and board of directors tenure and is there insider trading?

7.4yrs

Average management tenure


CEO

Paul Dykeman (58yo)

7.1yrs

Tenure

CA$476,000

Compensation

Mr. Paul Malcolm Dykeman, CPA, CA, serves as the Chief Executive Officer of Sigma Real Estate Advisors LLP. Mr. Dykeman has been the Chief Executive Officer and President of Summit Industrial Income REIT s ...


CEO Compensation Analysis

Compensation vs. Market: Paul's total compensation ($USD361.37K) is below average for companies of similar size in the Canadian market ($USD1.55M).

Compensation vs Earnings: Paul's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Management Age and Tenure

7.4yrs

Average Tenure

Experienced Management: SMU.UN's management team is seasoned and experienced (7.4 years average tenure).


Board Age and Tenure

6.5yrs

Average Tenure

63yo

Average Age

Experienced Board: SMU.UN's board of directors are considered experienced (6.5 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyCA$417,50012 Jun 19
Lawrence Morassutti
EntityIndividual
Role
Member of the Board of Directors
Independent Trustee
Shares33,400
Max PriceCA$12.50
BuyCA$250,00012 Jun 19
Saul Shulman
EntityIndividual
Role
Member of the Board of Directors
Independent Trustee
Shares20,000
Max PriceCA$12.50
BuyCA$76,31706 Jun 19
Louis Maroun
EntityIndividual
Role
Chairman of the Board
Chairman
Shares6,081
Max PriceCA$12.55
BuyCA$18,61310 May 19
Louis Maroun
EntityIndividual
Role
Chairman of the Board
Chairman
Shares1,527
Max PriceCA$12.19
BuyCA$93,32227 Dec 18
Lawrence Morassutti
EntityIndividual
Role
Member of the Board of Directors
Independent Trustee
Shares10,200
Max PriceCA$9.15
BuyCA$1,41022 Dec 18
Louis Maroun
EntityIndividual
Role
Chairman of the Board
Chairman
Shares150
Max PriceCA$9.40
BuyCA$92,35214 Dec 18
Louis Maroun
EntityIndividual
Role
Chairman of the Board
Chairman
Shares9,600
Max PriceCA$9.62
BuyCA$1,860,00011 Dec 18
Lawrence Morassutti
EntityIndividual
Role
Member of the Board of Directors
Independent Trustee
Shares200,000
Max PriceCA$9.30
BuyCA$4,92911 Dec 18
Kimberley Hill
EntityIndividual
Role
Senior Key Executive
Senior Vice President of Asset Management
Shares530
Max PriceCA$9.30
BuyCA$249,70511 Dec 18
Louis Maroun
EntityIndividual
Role
Chairman of the Board
Chairman
Shares26,850
Max PriceCA$9.30
BuyCA$9,30011 Dec 18
Jonathan Robbins
EntityIndividual
Role
Senior Key Executive
Senior Vice President of Acquisitions
Shares1,000
Max PriceCA$9.30
BuyCA$279,00011 Dec 18
Saul Shulman
EntityIndividual
Role
Member of the Board of Directors
Independent Trustee
Shares30,000
Max PriceCA$9.30

Ownership Breakdown


Management Team

  • Jon Robbins

    Senior Vice President of Acquisitions

    • Tenure: 7.8yrs
    • Compensation: CA$584.00k
  • Paul Dykeman (58yo)

    CEO, President & Trustee

    • Tenure: 7.1yrs
    • Compensation: CA$476.00k
  • Ross Drake

    Chief Financial Officer

    • Tenure: 7.1yrs
    • Compensation: CA$584.00k
  • Kimberley Hill

    Senior Vice President of Asset Management

    • Tenure: 7.8yrs
    • Compensation: CA$584.00k

Board Members

  • Saul Shulman (80yo)

    Independent Trustee

    • Tenure: 7.1yrs
    • Compensation: CA$66.20k
  • Larry Morassutti (63yo)

    Independent Trustee

    • Tenure: 6.5yrs
    • Compensation: CA$58.70k
  • Lou Maroun (69yo)

    Chairman

    • Tenure: 0yrs
  • Paul Dykeman (58yo)

    CEO, President & Trustee

    • Tenure: 7.1yrs
    • Compensation: CA$476.00k
  • Michael A. Catford (74yo)

    Independent Trustee

    • Tenure: 5.4yrs
    • Compensation: CA$57.60k
  • Jim Tadeson (52yo)

    Lead Independent Trustee

    • Tenure: 6.4yrs
    • Compensation: CA$71.20k
  • Dayna Gibbs (42yo)

    Independent Trustee

    • Tenure: 0.4yrs

Company Information

Summit Industrial Income REIT's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Summit Industrial Income REIT
  • Ticker: SMU.UN
  • Exchange: TSX
  • Founded: 2005
  • Industry: Industrial REITs
  • Sector: Real Estate
  • Implied Market Cap: CA$1.565b
  • Market Cap: CA$1.552b
  • Shares outstanding: 119.69m
  • Website: https://www.summitIIreit.com

Location

  • Summit Industrial Income REIT
  • 75 Summerlea Road
  • Unit B
  • Brampton
  • Ontario
  • L6T 4V2
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SMU.UNTSX (The Toronto Stock Exchange)YesTrust UnitsCACADJun 1999
SMMC.FOTCPK (Pink Sheets LLC)YesTrust UnitsUSUSDJun 1999

Biography

Summit Industrial Income REIT is an unincorporated open-end trust focused on growing and managing a portfolio of light industrial and other properties across Canada. Summit II's units are listed on the TSX ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/14 02:00
End of Day Share Price2019/10/11 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.

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