NYSE:ESRT

Stock Analysis Report

Empire State Realty Trust

Executive Summary

Empire State Realty Trust, Inc. (NYSE: ESRT), a leading real estate investment trust (REIT), owns, manages, operates, acquires and repositions office and retail properties in Manhattan and the greater New York metropolitan area, including the Empire State Building, the world's most famous building.

Rewards

Trading at 12.8% below its fair value

Earnings are forecast to grow 18.02% per year

Risk Analysis

Unstable dividend track record

Shareholders have been diluted in the past year



Snowflake Analysis

Second-rate dividend payer with questionable track record.

Share Price & News

How has Empire State Realty Trust's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

0.7%

ESRT

-0.06%

US REITs

1.1%

US Market


1 Year Return

-8.5%

ESRT

13.2%

US REITs

17.8%

US Market

Return vs Industry: ESRT underperformed the US REITs industry which returned 13.2% over the past year.

Return vs Market: ESRT underperformed the US Market which returned 17.8% over the past year.


Shareholder returns

ESRTIndustryMarket
7 Day0.7%-0.06%1.1%
30 Day-2.9%0.9%1.4%
90 Day-4.9%-0.2%3.9%
1 Year-5.9%-8.5%17.9%13.2%20.3%17.8%
3 Year-25.0%-29.8%34.4%17.7%44.8%35.4%
5 Year-11.7%-20.7%56.5%24.2%71.3%52.4%

Price Volatility Vs. Market

How volatile is Empire State Realty Trust's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Empire State Realty Trust undervalued compared to its fair value and its price relative to the market?

12.8%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ESRT ($14.05) is trading below our estimate of fair value ($16.11)

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


Price To Earnings Ratio

PE vs Industry: ESRT is poor value based on its PE Ratio (44.7x) compared to the REITs industry average (38.6x).

PE vs Market: ESRT is poor value based on its PE Ratio (44.7x) compared to the US market (18.4x).


Price to Earnings Growth Ratio

PEG Ratio: ESRT is poor value based on its PEG Ratio (2.5x)


Price to Book Ratio

PB vs Industry: ESRT is overvalued based on its PB Ratio (2.1x) compared to the US REITs industry average (2x).


Next Steps

Future Growth

How is Empire State Realty Trust forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

18.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ESRT's forecast earnings growth (18% per year) is above the savings rate (1.7%).

Earnings vs Market: ESRT's earnings (18% per year) are forecast to grow faster than the US market (14.2% per year).

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

Revenue vs Market: ESRT's revenue is expected to decline over the next 3 years (-4.5% per year).

High Growth Revenue: ESRT's revenue is forecast to decline over the next 3 years (-4.5% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

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


Next Steps

Past Performance

How has Empire State Realty Trust performed over the past 5 years?

10.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ESRT has high quality earnings.

Growing Profit Margin: ESRT's current net profit margins (7.8%) are lower than last year (8.5%).


Past Earnings Growth Analysis

Earnings Trend: ESRT's earnings have grown by 10.5% per year over the past 5 years.

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

Earnings vs Industry: ESRT had negative earnings growth (-7.6%) over the past year, making it difficult to compare to the REITs industry average (8.3%).


Return on Equity

High ROE: ESRT's Return on Equity (4.9%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Empire State Realty Trust'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: ESRT has a high level of physical assets or inventory.

Debt Coverage by Assets: ESRT's debt is not covered by short term assets (assets are 0.4x debt).


Financial Institutions Analysis

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

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

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

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

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

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


Next Steps

Dividend

What is Empire State Realty Trust's current dividend yield, its reliability and sustainability?

2.99%

Current Dividend Yield


Dividend Yield vs Market

company3.0%marketbottom25%1.4%markettop25%3.7%industryaverage3.7%forecastin3Years3.1%

Current dividend yield vs market & industry

Notable Dividend: ESRT's dividend (2.99%) is higher than the bottom 25% of dividend payers in the US market (1.44%).

High Dividend: ESRT's dividend (2.99%) is low compared to the top 25% of dividend payers in the US market (3.67%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, ESRT has been paying a dividend for less than 10 years.

Growing Dividend: ESRT's dividend payments have increased, but the company has only paid a dividend for 6 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (27.7%), ESRT's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ESRT's dividends in 3 years are forecast to be thoroughly covered by earnings (0.2% payout ratio).


Next Steps

Management

What is the CEO of Empire State Realty Trust's salary, the management and board of directors tenure and is there insider trading?

2.9yrs

Average management tenure


CEO

Tony Malkin (57yo)

7.9yrs

Tenure

US$9,530,041

Compensation

Mr. Anthony E. Malkin, also known as Tony, has been a Director of APi Group Corporation since October 2019. Mr. Malkin has been Chief Executive Officer and Chairman of Empire State Realty Trust, Inc since  ...


CEO Compensation Analysis

Compensation vs Market: Tony's total compensation ($USD9.53M) is above average for companies of similar size in the US market ($USD5.10M).

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


Management Age and Tenure

2.9yrs

Average Tenure

57yo

Average Age

Experienced Management: ESRT's management team is considered experienced (2.9 years average tenure).


Board Age and Tenure

6.2yrs

Average Tenure

57yo

Average Age

Experienced Board: ESRT's board of directors are considered experienced (6.2 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.


Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 7.4%.


Management Team

  • Tony Malkin (57yo)

    Chairman & CEO

    • Tenure: 7.9yrs
    • Compensation: US$9.53m
  • Tom Keltner (73yo)

    Executive VP

    • Tenure: 7.9yrs
    • Compensation: US$2.10m
  • Fred Posniak (73yo)

    Senior Vice President

    • Tenure: 2.4yrs
  • Drew Prentice (46yo)

    Senior VP

    • Tenure: 0.3yrs
  • Greg Faje

    Vice President

    • Tenure: 2.9yrs
  • Jeffrey Newman (59yo)

    Senior Vice President

    • Tenure: 0yrs
  • Tom Durels (57yo)

    Executive Vice President of Real Estate

    • Tenure: 1.9yrs
    • Compensation: US$4.67m
  • Ryan Kass

    Senior VP & Director of Leasing

    • Tenure: 0yrs
  • John Kessler (54yo)

    President & COO

    • Tenure: 4.8yrs
    • Compensation: US$4.54m

Board Members

  • Steve Gilbert (72yo)

    Lead Independent Director

    • Tenure: 6.2yrs
    • Compensation: US$259.33k
  • Tony Malkin (57yo)

    Chairman & CEO

    • Tenure: 7.9yrs
    • Compensation: US$9.53m
  • Bill Berkman (54yo)

    Independent Director

    • Tenure: 6.2yrs
    • Compensation: US$216.67k
  • Peter Malkin (85yo)

    Chairman Emeritus

    • Tenure: 0yrs
  • Tom DeRosa (61yo)

    Independent Director

    • Tenure: 6.2yrs
    • Compensation: US$209.50k
  • Jim Robinson (56yo)

    Independent Director

    • Tenure: 4.9yrs
    • Compensation: US$253.17k
  • Leslie Biddle (52yo)

    Independent Director

    • Tenure: 2.8yrs
    • Compensation: US$213.67k
  • Salvatore Giliberto (69yo)

    Independent Director

    • Tenure: 6.2yrs
    • Compensation: US$228.67k
  • Tricia Han (47yo)

    Independent Director

    • Tenure: 0.3yrs

Company Information

Empire State Realty Trust, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Empire State Realty Trust, Inc.
  • Ticker: ESRT
  • Exchange: NYSE
  • Founded:
  • Industry: Diversified REITs
  • Sector: Real Estate
  • Implied Market Cap: US$4.289b
  • Market Cap: US$2.542b
  • Shares outstanding: 305.04m
  • Website: https://www.empirestaterealtytrust.com

Number of Employees


Location

  • Empire State Realty Trust, Inc.
  • 111 West 33rd Street
  • 12th Floor
  • New York
  • New York
  • 10120
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ESRTNYSE (New York Stock Exchange)YesClass A Common StockUSUSDOct 2013
ES9DB (Deutsche Boerse AG)YesClass A Common StockDEEUROct 2013

Biography

Empire State Realty Trust, Inc. (NYSE: ESRT), a leading real estate investment trust (REIT), owns, manages, operates, acquires and repositions office and retail properties in Manhattan and the greater New  ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/11 00:43
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.