| Snowflake Score | |
|---|---|
| Valuation | 4/6 |
| Future Growth | 0/6 |
| Past Performance | 0/6 |
| Financial Health | 2/6 |
| Dividends | 4/6 |
RPT Stock Overview
RPT Realty owns and operates a national portfolio of open-air shopping destinations principally located in top U.S.
RPT Realty Competitors
Price History & Performance
| Historical stock prices | |
|---|---|
| Current Share Price | US$7.56 |
| 52 Week High | US$14.99 |
| 52 Week Low | US$7.28 |
| Beta | 1.52 |
| 1 Month Change | -21.00% |
| 3 Month Change | -23.56% |
| 1 Year Change | -43.16% |
| 3 Year Change | -43.24% |
| 5 Year Change | -42.60% |
| Change since IPO | -66.40% |
Recent News & Updates
RPT Realty: A Grocery-Anchored REIT With A 7.5% Preferred Dividend Yield
Summary RPT Realty is a commercial REIT aiming to increase its exposure to grocery-anchored locations. The FFOs are robust and the preferred dividends are well-covered. I like the risk/reward ratio for these preferred shares as the dividend coverage ratio and asset coverage ratio are excellent. Introduction It's been over a year since I last discussed RPT Realty's (RPT) preferred shares, which are trading as RPT.PD. These preferred shares cannot be called by the REIT (and can only converted into common shares which would unlock an immediate 34% capital gain) and as the REIT is performing pretty well, I think the preferred dividend is quite safe. As the interest rates have continued to increase, the share price of these preferred shares has decreased to less than $49. That's a 15% decrease and this has boosted the preferred dividend yield to just under 7.5%. RPT data by YCharts A look at RPT's Q2 results To figure out how interesting the preferred shares are, we first need to have a look at the performance of the REIT. The income statement provides us with 'some' information as for instance the Q2 EPS was just $0.06 given the $5.12M net income which includes the almost $1.7M in preferred dividend payments. RPT Realty Investor Relations Good to know, but I'm obviously more interested in the REIT's FFO calculation as the depreciation and amortization expenses are obviously weighing on the income statement but have no impact on the FFO. RPT Realty Investor Relations We see the FFO reported by RPT Realty in the second quarter was approximately $25.3M which is an improvement over the $24.1M in the first quarter of the year. The total FFO generated in the first semester came in at $49.4M. Keep in mind this does NOT include the preferred dividends yet. Because the preferred shares have a conversion feature (see later), RPT Realty has added the preferred dividends back to the FFO calculation. So the FFO per common unit was approximately $0.55 per share if I would exclude the pro-forma conversion (as there's no reason why anyone would convert the preferred shares into common units right now. For the entire financial year, the REIT is guiding for a full-year operating FFO per diluted share of $1.01-1.05. RPT Realty Investor Relations However, I don't think we should use the diluted share count exactly because the preferred shares (which account for the lion's share between outstanding shares and diluted shares) are nowhere being attractive enough to be converted and even further away from the mandatory conversion. Excluding the impact from the potential but unlikely dilution due to the preferred shares, RPT's FFO per common share will likely exceed the $1.05. The terms of the preferred share and its coverage ratios As a quick reminder, preferred shares have a 7.25% preferred dividend yield, resulting in a quarterly preferred dividend of $0.90625. And as explained in my previous article: An interesting feature is that there's no call provision included in these preferred shares: RPT Realty cannot call these securities, but owners of preferred shares are able and allowed to convert them into common units at a conversion price of $14.41/share (each preferred share entitles the owner to convert it into 3.7962 common units). This means that preferred shareholders can benefit from a run-up in the share price of the underlying units without running the same risks. The sole caveat is that RPT may force the conversion into common units, but can only do so after its common shares have been trading at in excess of 130% of the conversion price for 20 of any 30 consecutive trading days. Using the $50 principal amount and the conversion rate of 3.7962, the conversion price is now approximately $13.17 which means RPT needs to trade at 1.30 * $13.17 = $17.12 before the REIT can call these preferred shares. That means that if that would happen at exactly that price, preferred shareholders will receive 3.7962 shares valued at $17.12 each, putting the value of the preferred share at $65. This creates a no-lose scenario as long as the REIT doesn't go bankrupt. Investors happily collect the 7.5% preferred dividends and could potentially get a 34% capital gain if the securities get called (which I don't think will happen anytime soon). We know from the FFO calculation that the FFO excluding the preferred dividends came in at $49.4M in the first half of the year. Including the $3.35M in preferred dividends, the FFO attributable to the common unit holders was approximately $46M and the preferred dividend coverage ratio was just under 1,500%. In other words, less than 7% of the FFO was needed to cover the preferred dividends. A very healthy low percentage. And looking at the balance sheet (see below), the preferred shares represent about $92.5M of the total equity value which stood at $885M. This means there is almost $800M in equity ranked junior to the preferred shares which also is a very healthy ratio. RPT Realty Investor Relations And we shouldn't be too worried about the balance sheet in general. The almost $2B in assets are covered by $1.08B in liabilities and about $900M in equity. The gross debt level was approximately $961M as of the end of June but as the company had about $24M in cash and restricted cash, the net debt was just under $940M. While that sounds relatively high compared to the $1.75B in real estate and JV investments (this indicates an LTV ratio of almost 54%), keep in mind the $1.51B held in real estate already includes almost $400M in accumulated depreciation. So I'm not worried at all about the REIT's balance sheet and the relatively low amount of preferred equity outstanding means the preferred dividends and preferred equity value are very well covered.
RPT Realty secures upsized $810M credit facility
RPT Realty (NYSE:RPT) stated Tuesday that it has closed on its $810M amended and restated unsecured credit facility, reflecting an increase of $150M over the prior facility. It consists of a $500M unsecured revolving line of credit with an initial maturity in 2026 with two six-month extension options, subject to certain conditions, and $310M of term loans with maturities in 2026 through 2028 at fixed interest rate of 2.62%. The company said, "Following the closing of the facility and the expected payoff of The Shops on Lane mortgage in the Q4 2022, it will have no debt maturing through 2024 and will increase the weighted average maturity by approximately one year." Earlier: Site Centers upgraded at Mizuho, RPT Realty cut as recession risks rise
Shareholder Returns
| RPT | US REITs | US Market | |
|---|---|---|---|
| 7D | -6.8% | -4.1% | -2.5% |
| 1Y | -43.2% | -20.4% | -23.2% |
Return vs Industry: RPT underperformed the US REITs industry which returned -20.4% over the past year.
Return vs Market: RPT underperformed the US Market which returned -23.2% over the past year.
Price Volatility
| RPT volatility | |
|---|---|
| RPT Average Weekly Movement | 4.7% |
| REITs Industry Average Movement | 4.1% |
| Market Average Movement | 6.9% |
| 10% most volatile stocks in US Market | 15.6% |
| 10% least volatile stocks in US Market | 2.8% |
Stable Share Price: RPT is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 5% a week.
Volatility Over Time: RPT's weekly volatility (5%) has been stable over the past year.
About the Company
| Founded | Employees | CEO | Website |
|---|---|---|---|
| 1997 | 125 | Brian Harper | https://www.rptrealty.com |
RPT Realty owns and operates a national portfolio of open-air shopping destinations principally located in top U.S. markets. The Company's shopping centers offer diverse, locally-curated consumer experiences that reflect the lifestyles of their surrounding communities and meet the modern expectations of the Company's retail partners. The Company is a fully integrated and self-administered REIT publicly traded on the New York Stock Exchange (the “NYSE”).
RPT Realty Fundamentals Summary
| RPT fundamental statistics | |
|---|---|
| Market Cap | US$656.64m |
| Earnings (TTM) | US$20.64m |
| Revenue (TTM) | US$223.36m |
31.2x
P/E Ratio2.9x
P/S RatioIs RPT overvalued?
See Fair Value and valuation analysisEarnings & Revenue
| RPT income statement (TTM) | |
|---|---|
| Revenue | US$223.36m |
| Cost of Revenue | US$63.80m |
| Gross Profit | US$159.56m |
| Other Expenses | US$138.92m |
| Earnings | US$20.64m |
Last Reported Earnings
Jun 30, 2022
Next Earnings Date
Nov 02, 2022
| Earnings per share (EPS) | 0.24 |
| Gross Margin | 71.44% |
| Net Profit Margin | 9.24% |
| Debt/Equity Ratio | 106.4% |
How did RPT perform over the long term?
See historical performance and comparison