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 Analysis

Fair value 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

Stable Share Price: SMU.UN's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

30.1%

SMU.UN

11.4%

CA REITs

6.3%

CA Market


1 Year Return

-11.3%

SMU.UN

-18.3%

CA REITs

-19.7%

CA Market

Return vs Industry: SMU.UN exceeded the Canadian REITs industry which returned -18.3% over the past year.

Return vs Market: SMU.UN exceeded the Canadian Market which returned -19.7% over the past year.


Shareholder returns

SMU.UNIndustryMarket
7 Day30.1%11.4%6.3%
30 Day-9.9%-19.6%-5.3%
90 Day-11.3%-21.0%-20.3%
1 Year-6.8%-11.3%-14.1%-18.3%-17.0%-19.7%
3 Year90.1%59.4%5.7%-10.5%-7.9%-16.5%
5 Year135.2%67.0%21.4%-8.6%3.7%-11.8%

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 compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: SMU.UN (CA$10.47) is trading below our estimate of fair value (CA$24.78)

Significantly Below Fair Value: SMU.UN is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: SMU.UN is poor value based on its PE Ratio (8.2x) compared to the REITs industry average (8.1x).

PE vs Market: SMU.UN is good value based on its PE Ratio (8.2x) compared to the Canadian market (11.7x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: SMU.UN is overvalued based on its PB Ratio (1x) compared to the CA REITs industry average (0.8x).


Next Steps

Future Growth

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

17.7%

Forecasted annual revenue growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if SMU.UN's forecast earnings growth is above the savings rate (1.4%).

Earnings vs Market: Insufficient data to determine if SMU.UN's earnings are forecast to grow faster than the Canadian market

High Growth Earnings: Insufficient data to determine if earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: SMU.UN's revenue (17.7% per year) is forecast to grow faster than the Canadian market (3.3% per year).

High Growth Revenue: SMU.UN's revenue (17.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

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?

49.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SMU.UN has a large one-off gain of CA$92.0M impacting its December 31 2019 financial results.

Growing Profit Margin: SMU.UN's current net profit margins are lower than last year .


Past Earnings Growth Analysis

Earnings Trend: SMU.UN's earnings have grown significantly by 49.4% 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 (-18.2%) over the past year, making it difficult to compare to the REITs industry average (6.7%).


Return on Equity

High ROE: SMU.UN's Return on Equity (10.4%) is considered low.


Next Steps

Financial Health

How is Summit Industrial Income REIT's financial position?


Financial Position Analysis

Short Term Liabilities: SMU.UN's short term assets (CA$32.6M) do not cover its short term liabilities (CA$498.6M).

Long Term Liabilities: SMU.UN's short term assets (CA$32.6M) do not cover its long term liabilities (CA$691.6M).


Debt to Equity History and Analysis

Debt Level: SMU.UN's debt to equity ratio (77.9%) is considered high.

Reducing Debt: SMU.UN's debt to equity ratio has reduced from 130.9% to 77.9% over the past 5 years.

Debt Coverage: SMU.UN's debt is not well covered by operating cash flow (4.5%).

Interest Coverage: SMU.UN's interest payments on its debt are not well covered by EBIT (2.8x coverage).


Balance Sheet


Next Steps

Dividend

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

5.16%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: SMU.UN's dividend (5.16%) is higher than the bottom 25% of dividend payers in the Canadian market (2.4%).

High Dividend: SMU.UN's dividend (5.16%) is low compared to the top 25% of dividend payers in the Canadian market (7.78%).


Stability and Growth of Payments

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 (80.1%), 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 (0.5% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

7.6yrs

Average management tenure


CEO

Paul Dykeman (58yo)

7.58s

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 ($USD339.98K) is below average for companies of similar size in the Canadian market ($USD1.66M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Paul Dykeman
CEO, President & Trustee7.58yrsCA$476.00k1.19% CA$17.1m
Ross Drake
Chief Financial Officer7.58yrsCA$584.00k0.11% CA$1.6m
Jonathan Robbins
Senior Vice President of Investmentsno dataCA$584.00k0.011% CA$152.9k
Kimberley Hill
Senior Vice President of Asset Management8.25yrsCA$584.00k0.039% CA$563.0k

7.6yrs

Average Tenure

Experienced Management: SMU.UN's management team is seasoned and experienced (7.6 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Paul Dykeman
CEO, President & Trustee7.58yrsCA$476.00k1.19% CA$17.1m
Saul Shulman
Independent Trustee7.58yrsCA$66.20k0.14% CA$2.0m
Lawrence Morassutti
Independent Trustee7yrsCA$58.70k2.59% CA$37.3m
Louis Maroun
Independent Chairmanno datano data5.48% CA$79.2m
Michael A. Catford
Independent Trustee5.92yrsCA$57.60k0.029% CA$420.8k
T. Tadeson
Lead Independent Trustee6.92yrsCA$71.20k0.067% CA$961.5k
Dayna Gibbs
Independent Trustee0.92yrno datano data

7.0yrs

Average Tenure

63yo

Average Age

Experienced Board: SMU.UN's board of directors are considered experienced (7 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: SMU.UN insiders have sold more shares than they have bought in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 48.4%.


Top Shareholders

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$1.444b
  • Market Cap: CA$1.437b
  • Shares outstanding: 137.91m
  • 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 and trade under the symbol SMU.UN. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/10 05:25
End of Day Share Price2020/04/09 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.