NYSE:ARE

Stock Analysis Report

Alexandria Real Estate Equities

Executive Summary

Alexandria Real Estate Equities, Inc. (NYSE: ARE), an S&P 500<sup>®</sup>urban office real estate investment trust ("REIT"), is the first and longest-tenured owner, operator, and developer uniquely focused on collaborative life science, technology, and agtech campuses in AAA innovation cluster locations, with a total market capitalization of $24.3 billion as of September 30, 2019, and an asset base in North America of 38.5 million square feet ("SF") as of October 28, 2019, including pending acquisitions.

Rewards

Trading at 16.2% below its fair value

Earnings are forecast to grow 24.92% per year

Pays a high and reliable dividend of 2.63%

Risk Analysis

Profit margins (8.2%) are lower than last year (33.3%)

Shareholders have been diluted in the past year



Snowflake Analysis

Established dividend payer with reasonable growth potential.


Similar Companies

Digital Realty Trust

NYSE:DLR

Share Price & News

How has Alexandria Real Estate Equities's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ARE has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-3.4%

ARE

-3.0%

US REITs

0.7%

US Market


1 Year Return

27.7%

ARE

11.0%

US REITs

21.1%

US Market

Return vs Industry: ARE exceeded the US REITs industry which returned 11% over the past year.

Return vs Market: ARE exceeded the US Market which returned 21.1% over the past year.


Shareholder returns

AREIndustryMarket
7 Day-3.4%-3.0%0.7%
30 Day-1.4%-2.8%2.3%
90 Day2.2%-2.2%5.0%
1 Year31.5%27.7%15.7%11.0%23.7%21.1%
3 Year58.2%44.9%31.9%15.4%47.0%37.4%
5 Year106.3%76.9%49.0%18.1%65.7%47.5%

Price Volatility Vs. Market

How volatile is Alexandria Real Estate Equities's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Alexandria Real Estate Equities undervalued compared to its fair value and its price relative to the market?

16.2%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ARE ($156.47) is trading below our estimate of fair value ($186.62)

Significantly Below Fair Value: ARE is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: ARE is poor value based on its PE Ratio (143.3x) compared to the REITs industry average (36.8x).

PE vs Market: ARE is poor value based on its PE Ratio (143.3x) compared to the US market (18.6x).


Price to Earnings Growth Ratio

PEG Ratio: ARE is poor value based on its PEG Ratio (5.8x)


Price to Book Ratio

PB vs Industry: ARE is overvalued based on its PB Ratio (2.3x) compared to the US REITs industry average (1.9x).


Next Steps

Future Growth

How is Alexandria Real Estate Equities forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

24.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ARE's forecast earnings growth (24.9% per year) is above the savings rate (1.7%).

Earnings vs Market: ARE's earnings (24.9% per year) are forecast to grow faster than the US market (14.2% per year).

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

Revenue vs Market: ARE's revenue (10.6% per year) is forecast to grow faster than the US market (7.4% per year).

High Growth Revenue: ARE's revenue (10.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ARE's Return on Equity is forecast to be low in 3 years time (2.8%).


Next Steps

Past Performance

How has Alexandria Real Estate Equities performed over the past 5 years?

38.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ARE has high quality earnings.

Growing Profit Margin: ARE's current net profit margins (8.2%) are lower than last year (33.3%).


Past Earnings Growth Analysis

Earnings Trend: ARE's earnings have grown significantly by 38% per year over the past 5 years.

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

Earnings vs Industry: ARE had negative earnings growth (-72.1%) over the past year, making it difficult to compare to the REITs industry average (8.3%).


Return on Equity

High ROE: ARE's Return on Equity (1.9%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Alexandria Real Estate Equities'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: ARE has a high level of physical assets or inventory.

Debt Coverage by Assets: ARE's debt is not covered by short term assets (assets are 0.2x debt).


Financial Institutions Analysis

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

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

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

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

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

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


Next Steps

Dividend

What is Alexandria Real Estate Equities's current dividend yield, its reliability and sustainability?

2.63%

Current Dividend Yield


Upcoming Dividend Payment

Purchase Alexandria Real Estate Equities before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company2.6%marketbottom25%1.4%markettop25%3.7%industryaverage3.8%forecastin3Years2.7%

Current dividend yield vs market & industry

Notable Dividend: ARE's dividend (2.63%) is higher than the bottom 25% of dividend payers in the US market (1.43%).

High Dividend: ARE's dividend (2.63%) is low compared to the top 25% of dividend payers in the US market (3.71%).


Stability and Growth of Payments

Stable Dividend: ARE's dividends per share have been stable in the past 10 years.

Growing Dividend: ARE's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (70.8%), ARE's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ARE's dividends in 3 years are forecast to be thoroughly covered by earnings (0.5% payout ratio).


Next Steps

Management

What is the CEO of Alexandria Real Estate Equities's salary, the management and board of directors tenure and is there insider trading?

1.7yrs

Average management tenure


CEO

Peter Moglia (52yo)

1.7yrs

Tenure

US$7,447,459

Compensation

Mr. Peter M. Moglia has been the Chief Investment Officer of Alexandria Real Estate Equities, Inc. since January 2009 and has been its Co-Chief Executive Officer since April 23, 2018. Mr. Moglia has been w ...


CEO Compensation Analysis

Compensation vs Market: Peter's total compensation ($USD7.45M) is below average for companies of similar size in the US market ($USD10.94M).

Compensation vs Earnings: Peter's compensation has been consistent with company performance over the past year.


Management Age and Tenure

1.7yrs

Average Tenure

58yo

Average Age

Experienced Management: ARE's management team is not considered experienced ( 1.7 years average tenure), which suggests a new team.


Board Age and Tenure

10.1yrs

Average Tenure

62yo

Average Age

Experienced Board: ARE's board of directors are seasoned and experienced ( 10.1 years average tenure).


Insider Trading

Insider Buying: ARE insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$1,158,67501 Oct 19
Joel Marcus
EntityIndividual
Role
Chairman of the Board
Founder & Executive Chairman
Shares7,500
Max PriceUS$154.49
SellUS$897,07012 Sep 19
Vincent Ciruzzi
EntityIndividual
Shares5,933
Max PriceUS$151.20
SellUS$1,489,31310 Sep 19
Joel Marcus
EntityIndividual
Role
Chairman of the Board
Founder & Executive Chairman
Shares9,750
Max PriceUS$152.75
SellUS$864,00015 Aug 19
John Cunningham
EntityIndividual
Shares6,000
Max PriceUS$144.00
SellUS$553,79312 Aug 19
Marc Binda
EntityIndividual
Shares3,775
Max PriceUS$146.70
SellUS$3,648,25012 Aug 19
Joel Marcus
EntityIndividual
Role
Chairman of the Board
Founder & Executive Chairman
Shares25,000
Max PriceUS$146.65
SellUS$1,450,60009 Aug 19
Thomas Andrews
EntityIndividual
Role
Co-President
Co-President & Regional Market Director of Greater Boston
Shares10,000
Max PriceUS$145.06
SellUS$435,48009 Aug 19
Peter Moglia
EntityIndividual
Role
Co-Chief Executive Officer
Co-CEO & Co-Chief Investment Officer
Shares3,000
Max PriceUS$145.16
SellUS$1,450,82508 Aug 19
Stephen Richardson
EntityIndividual
Role
Co-Chief Executive Officer
Co-Chief Executive Officer
Shares10,000
Max PriceUS$145.11
SellUS$646,15507 Aug 19
Peter Moglia
EntityIndividual
Role
Co-Chief Executive Officer
Co-CEO & Co-Chief Investment Officer
Shares4,500
Max PriceUS$144.50
SellUS$1,447,60006 Aug 19
Daniel Ryan
EntityIndividual
Role
Co-Chief Investment Officer
Co-Chief Investment Officer & Regional Market Director - San Diego
Shares10,000
Max PriceUS$144.76
SellUS$551,30105 Aug 19
Marc Binda
EntityIndividual
Shares3,775
Max PriceUS$146.04
SellUS$2,902,00005 Aug 19
Joel Marcus
EntityIndividual
Role
Chairman of the Board
Founder & Executive Chairman
Shares20,000
Max PriceUS$146.00
SellUS$62,91901 Jul 19
James Cain
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares450
Max PriceUS$139.82
SellUS$210,00028 Jun 19
Lawrence Diamond
EntityIndividual
Role
Co-Chief Operating Officer
Co-COO, Senior VP & Regional Market Director of Maryland
Shares1,500
Max PriceUS$140.00
SellUS$279,86028 Jun 19
Jennifer Banks
EntityIndividual
Role
Co-Chief Operating Officer
Co-COO, General Counsel & Corporate Secretary
Shares2,000
Max PriceUS$139.93
SellUS$1,195,69510 May 19
Joel Marcus
EntityIndividual
Role
Chairman of the Board
Founder & Executive Chairman
Shares8,500
Max PriceUS$140.67
SellUS$32,23408 May 19
Richard Klein
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares227
Max PriceUS$142.00
SellUS$2,130,45006 May 19
Joel Marcus
EntityIndividual
Role
Chairman of the Board
Founder & Executive Chairman
Shares15,000
Max PriceUS$142.03
SellUS$157,17801 Apr 19
Richard Klein
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,103
Max PriceUS$142.50
SellUS$142,58029 Mar 19
Lawrence Diamond
EntityIndividual
Role
Co-Chief Operating Officer
Co-COO, Senior VP & Regional Market Director of Maryland
Shares1,000
Max PriceUS$142.58
SellUS$6,408,05029 Mar 19
Joel Marcus
EntityIndividual
Role
Chairman of the Board
Founder & Executive Chairman
Shares45,000
Max PriceUS$142.83
SellUS$419,67021 Mar 19
Peter Moglia
EntityIndividual
Role
Co-Chief Executive Officer
Co-CEO & Co-Chief Investment Officer
Shares3,000
Max PriceUS$139.89
SellUS$526,29819 Mar 19
Peter Moglia
EntityIndividual
Role
Co-Chief Executive Officer
Co-CEO & Co-Chief Investment Officer
Shares3,721
Max PriceUS$141.44
SellUS$424,38015 Mar 19
James Richardson
EntityIndividual
Role
Member of the Board of Directors
Senior Management Consultant & Non-Executive Director
Shares3,000
Max PriceUS$141.46
SellUS$957,88026 Feb 19
Daniel Ryan
EntityIndividual
Role
Co-Chief Investment Officer
Co-Chief Investment Officer & Regional Market Director - San Diego
Shares7,000
Max PriceUS$136.84
SellUS$1,353,70021 Feb 19
Stephen Richardson
EntityIndividual
Role
Co-Chief Executive Officer
Co-Chief Executive Officer
Shares10,000
Max PriceUS$135.37
SellUS$2,017,05020 Feb 19
Dean Shigenaga
EntityIndividual
Role
Co-President
Co-President & CFO
Shares15,000
Max PriceUS$134.47
SellUS$1,344,10020 Feb 19
Joel Marcus
EntityIndividual
Role
Chairman of the Board
Founder & Executive Chairman
Shares10,000
Max PriceUS$134.41
SellUS$3,354,50019 Feb 19
Thomas Andrews
EntityIndividual
Role
Co-President
Co-President & Regional Market Director of Greater Boston
Shares25,000
Max PriceUS$134.18
SellUS$661,30013 Feb 19
John Cunningham
EntityIndividual
Shares5,000
Max PriceUS$132.26
SellUS$874,43512 Feb 19
Vincent Ciruzzi
EntityIndividual
Shares6,621
Max PriceUS$132.07
SellUS$660,15012 Feb 19
James Richardson
EntityIndividual
Role
Member of the Board of Directors
Senior Management Consultant & Non-Executive Director
Shares5,000
Max PriceUS$132.03
SellUS$659,60012 Feb 19
Jennifer Banks
EntityIndividual
Role
Co-Chief Operating Officer
Co-COO, General Counsel & Corporate Secretary
Shares5,000
Max PriceUS$131.92
SellUS$1,300,10011 Feb 19
Joel Marcus
EntityIndividual
Role
Chairman of the Board
Founder & Executive Chairman
Shares10,000
Max PriceUS$130.01

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 9.9%.


Management Team

  • Joel Marcus (71yo)

    Founder & Executive Chairman

    • Tenure: 12.6yrs
    • Compensation: US$11.81m
  • James Richardson (59yo)

    Senior Management Consultant & Non-Executive Director

    • Tenure: 20.8yrs
    • Compensation: US$295.81k
  • Tom Andrews (59yo)

    Co-President & Regional Market Director of Greater Boston

    • Tenure: 1.7yrs
    • Compensation: US$7.11m
  • Dean Shigenaga (52yo)

    Co-President & CFO

    • Tenure: 1.7yrs
    • Compensation: US$7.09m
  • Andres Gavinet

    Chief Accounting Officer

    • Tenure: 0yrs
  • Peter Moglia (52yo)

    Co-CEO & Co-Chief Investment Officer

    • Tenure: 1.7yrs
    • Compensation: US$7.45m
  • Steve Richardson (58yo)

    Co-Chief Executive Officer

    • Tenure: 1.7yrs
    • Compensation: US$7.45m
  • Dan Ryan (53yo)

    Co-Chief Investment Officer & Regional Market Director - San Diego

    • Tenure: 0yrs
    • Compensation: US$6.54m
  • Jennifer Banks (48yo)

    Co-COO, General Counsel & Corporate Secretary

    • Tenure: 1.7yrs
    • Compensation: US$3.65m
  • Larry Diamond (61yo)

    Co-COO, Senior VP & Regional Market Director of Maryland

    • Tenure: 1.7yrs

Board Members

  • Joel Marcus (71yo)

    Founder & Executive Chairman

    • Tenure: 12.6yrs
    • Compensation: US$11.81m
  • James Richardson (59yo)

    Senior Management Consultant & Non-Executive Director

    • Tenure: 20.8yrs
    • Compensation: US$295.81k
  • Michael Woronoff (58yo)

    Independent Director

    • Tenure: 2.4yrs
    • Compensation: US$250.04k
  • Richard Klein (63yo)

    Independent Director

    • Tenure: 16yrs
    • Compensation: US$275.09k
  • John Atkins (75yo)

    Independent Director

    • Tenure: 12.8yrs
    • Compensation: US$275.09k
  • Maria Freire (65yo)

    Independent Director

    • Tenure: 7.7yrs
    • Compensation: US$260.09k
  • Steve Hash (54yo)

    Lead Independent Director

    • Tenure: 3.8yrs
    • Compensation: US$337.28k
  • James Cain (61yo)

    Independent Director

    • Tenure: 4yrs
    • Compensation: US$246.09k

Company Information

Alexandria Real Estate Equities, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Alexandria Real Estate Equities, Inc.
  • Ticker: ARE
  • Exchange: NYSE
  • Founded: 1993
  • Industry: Office REITs
  • Sector: Real Estate
  • Market Cap: US$18.018b
  • Shares outstanding: 115.15m
  • Website: https://www.are.com

Number of Employees


Location

  • Alexandria Real Estate Equities, Inc.
  • 26 North Euclid Avenue
  • Pasadena
  • California
  • 91101
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ARENYSE (New York Stock Exchange)YesCommon StockUSUSDMay 1997
A6WDB (Deutsche Boerse AG)YesCommon StockDEEURMay 1997
ARE *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNMay 1997
0HCHLSE (London Stock Exchange)YesCommon StockGBUSDMay 1997

Biography

Alexandria Real Estate Equities, Inc. (NYSE: ARE), an S&P 500<sup>®</sup>urban office real estate investment trust ("REIT"), is the first and longest-tenured owner, operator, and developer uniquely focused ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/15 23:30
End of Day Share Price2019/12/13 00:00
Earnings2019/09/30
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.