NYSE:EQC

Stock Analysis Report

Executive Summary

Equity Commonwealth (NYSE: EQC) is a Chicago based, internally managed and self-advised real estate investment trust (REIT) with commercial office properties in the United States.

Rewards

PE ratio (8.2x) is below the US market (18.5x)

Earnings grew by 112.5% over the past year

Risk Analysis

Earnings are forecast to decline by an average of -108% per year for the next 3 years

High level of non-cash earnings



Snowflake Analysis

Proven track record and fair value.


Similar Companies

Share Price & News

How has Equity Commonwealth's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

-1.5%

EQC

1.0%

US REITs

0.7%

US Market


1 Year Return

3.2%

EQC

13.0%

US REITs

18.2%

US Market

Return vs Industry: EQC underperformed the US REITs industry which returned 13% over the past year.

Return vs Market: EQC underperformed the US Market which returned 18.2% over the past year.


Shareholder returns

EQCIndustryMarket
7 Day-1.5%1.0%0.7%
30 Day1.7%1.7%1.5%
90 Day-4.1%0.8%5.0%
1 Year14.9%3.2%17.8%13.0%20.8%18.2%
3 Year31.7%9.0%34.3%17.5%45.2%35.8%
5 Year61.7%34.0%58.3%25.6%71.6%52.7%

Price Volatility Vs. Market

How volatile is Equity Commonwealth's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Equity Commonwealth undervalued compared to its fair value and its price relative to the market?

8.17x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: EQC ($32.43) is trading above our estimate of fair value ($13.9)

Significantly Below Fair Value: EQC is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: EQC is good value based on its PE Ratio (8.2x) compared to the REITs industry average (38.8x).

PE vs Market: EQC is good value based on its PE Ratio (8.2x) compared to the US market (18.5x).


Price to Earnings Growth Ratio

PEG Ratio: EQC's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: EQC is good value based on its PB Ratio (1.3x) compared to the US REITs industry average (2x).


Next Steps

Future Growth

How is Equity Commonwealth forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

-108.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: EQC's earnings are forecast to decline over the next 3 years (-108% per year).

Earnings vs Market: EQC's earnings are forecast to decline over the next 3 years (-108% per year).

High Growth Earnings: EQC's earnings are forecast to decline over the next 3 years.

Revenue vs Market: EQC's revenue is expected to decline over the next 3 years (-33.4% per year).

High Growth Revenue: EQC's revenue is forecast to decline over the next 3 years (-33.4% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

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


Next Steps

Past Performance

How has Equity Commonwealth performed over the past 5 years?

44.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: EQC has a high level of non-cash earnings.

Growing Profit Margin: EQC's current net profit margins are higher than last year .


Past Earnings Growth Analysis

Earnings Trend: EQC's earnings have grown significantly by 44.1% per year over the past 5 years.

Accelerating Growth: EQC's earnings growth over the past year (112.5%) exceeds its 5-year average (44.1% per year).

Earnings vs Industry: EQC earnings growth over the past year (112.5%) exceeded the REITs industry 8.3%.


Return on Equity

High ROE: EQC's Return on Equity (15.3%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Equity Commonwealth'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: EQC has a low level of unsold assets or inventory.

Debt Coverage by Assets: EQC's debt is covered by short term assets (assets are 124.7x debt).


Financial Institutions Analysis

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

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

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

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

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

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


Next Steps

Dividend

What is Equity Commonwealth's current dividend yield, its reliability and sustainability?

5.40%

Forecast Dividend Yield


Dividend Yield vs Market

company0%marketbottom25%1.4%markettop25%3.7%industryaverage3.7%forecastin3Years5.4%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate EQC's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate EQC's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if EQC's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if EQC's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: EQC is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of EQC's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of Equity Commonwealth's salary, the management and board of directors tenure and is there insider trading?

5.6yrs

Average management tenure


CEO

David Helfand (54yo)

5.6yrs

Tenure

US$6,260,516

Compensation

Mr. David A. Helfand has been the Chief Executive Officer and President at Equity Commonwealth since May 2014. Mr. Helfand has been a Co-President at Equity Group Investments since January 2012 where he ha ...


CEO Compensation Analysis

Compensation vs Market: David's total compensation ($USD6.26M) is about average for companies of similar size in the US market ($USD5.09M).

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


Management Age and Tenure

5.6yrs

Average Tenure

53yo

Average Age

Experienced Management: EQC's management team is seasoned and experienced (5.6 years average tenure).


Board Age and Tenure

5.6yrs

Average Tenure

62.5yo

Average Age

Experienced Board: EQC's board of directors are considered experienced (5.6 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

SellUS$399,50013 May 19
Adam Markman
EntityIndividual
Role
Chief Financial Officer
Executive VP
Shares12,500
Max PriceUS$31.96
SellUS$194,76020 Feb 19
James Lozier
EntityIndividual
Role
Member of the Board of Directors
Independent Trustee
Shares6,000
Max PriceUS$32.46

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • David Helfand (54yo)

    President

    • Tenure: 5.6yrs
    • Compensation: US$6.26m
  • Adam Markman (54yo)

    Executive VP

    • Tenure: 5.4yrs
    • Compensation: US$2.91m
  • Jeff Brown (53yo)

    Chief Accounting Officer & Senior VP

    • Tenure: 5.4yrs
  • Sarah Byrnes

    Vice President of Investor Relations & Capital Markets

    • Tenure: 0yrs
  • David Weinberg (50yo)

    Executive VP & COO

    • Tenure: 5.6yrs
    • Compensation: US$3.38m
  • Orrin Shifrin (52yo)

    Executive VP

    • Tenure: 5.6yrs
    • Compensation: US$2.54m

Board Members

  • David Helfand (54yo)

    President

    • Tenure: 5.6yrs
    • Compensation: US$6.26m
  • Ed Glickman (62yo)

    Independent Trustee

    • Tenure: 5.6yrs
    • Compensation: US$168.00k
  • Marty Edelman (77yo)

    Independent Trustee

    • Tenure: 5.4yrs
    • Compensation: US$166.00k
  • Peter Linneman (68yo)

    Lead Independent Trustee

    • Tenure: 0yrs
    • Compensation: US$198.00k
  • Mary Robertson (65yo)

    Independent Trustee

    • Tenure: 5.4yrs
    • Compensation: US$180.00k
  • Sam Zell (77yo)

    Chairman of the Board

    • Tenure: 5.6yrs
    • Compensation: US$2.33m
  • Jim Lozier (63yo)

    Independent Trustee

    • Tenure: 5.6yrs
    • Compensation: US$166.00k
  • Jim Corl (52yo)

    Independent Trustee

    • Tenure: 5.6yrs
    • Compensation: US$166.00k
  • James Star (58yo)

    Independent Trustee

    • Tenure: 5.4yrs
    • Compensation: US$175.00k
  • Kenneth Shea (61yo)

    Independent Trustee

    • Tenure: 5.6yrs
    • Compensation: US$175.00k

Company Information

Equity Commonwealth's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Equity Commonwealth
  • Ticker: EQC
  • Exchange: NYSE
  • Founded: 1986
  • Industry: Office REITs
  • Sector: Real Estate
  • Implied Market Cap: US$3.989b
  • Market Cap: US$3.987b
  • Shares outstanding: 121.97m
  • Website: https://www.eqcre.com

Number of Employees


Location

  • Equity Commonwealth
  • Two North Riverside Plaza
  • Suite 2100
  • Chicago
  • Illinois
  • 60606
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
EQCNYSE (New York Stock Exchange)YesCommon SharesUSUSDDec 1986
HP5ADB (Deutsche Boerse AG)YesCommon SharesDEEURDec 1986
EQC.PRDNYSE (New York Stock Exchange)CUM PFD S D 6.5%USUSDOct 2006

Biography

Equity Commonwealth (NYSE: EQC) is a Chicago based, internally managed and self-advised real estate investment trust (REIT) with commercial office properties in the United States. As of October 29, 2019, E ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/10 23:38
End of Day Share Price2019/12/10 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.