NYSE:SRG

Stock Analysis Report

Seritage Growth Properties

Executive Summary

Seritage Growth Properties is a publicly-traded, self-administered and self-managed REIT with 189 wholly-owned properties and 28 joint venture properties totaling approximately 34.4 million square feet of space across 44 states and Puerto Rico.


Snowflake Analysis

Overvalued with worrying balance sheet.

Share Price & News

How has Seritage Growth Properties's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

0.8%

SRG

-0.2%

US REITs

0.06%

US Market


1 Year Return

-13.9%

SRG

15.9%

US REITs

19.3%

US Market

Return vs Industry: SRG underperformed the US REITs industry which returned 14.9% over the past year.

Return vs Market: SRG underperformed the US Market which returned 20.3% over the past year.


Shareholder returns

SRGIndustryMarket
7 Day0.8%-0.2%0.06%
30 Day-3.3%3.7%1.7%
90 Day-10.6%7.8%9.0%
1 Year-13.4%-13.9%20.6%15.9%21.8%19.3%
3 Year-15.0%-19.5%37.5%20.3%49.5%39.9%
5 Yearn/a59.9%27.0%73.1%54.1%

Price Volatility Vs. Market

How volatile is Seritage Growth Properties's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Seritage Growth Properties undervalued compared to its fair value and its price relative to the market?

1.86x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: Insufficient data to calculate SRG's fair value to establish if it is undervalued.

Significantly Below Fair Value: Insufficient data to calculate SRG's fair value to establish if it is undervalued.


Price To Earnings Ratio

PE vs Industry: SRG is unprofitable, so we can't compare its PE Ratio to the REITs industry average.

PE vs Market: SRG is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: SRG is good value based on its PB Ratio (1.8x) compared to the US REITs industry average (2.1x).


Next Steps

Future Growth

How is Seritage Growth Properties forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

0.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SRG is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: SRG is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: SRG is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: Insufficient data to determine if SRG's revenue is forecast to grow faster than the US market.

High Growth Revenue: Insufficient data to determine if SRG's revenue is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

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


Next Steps

Past Performance

How has Seritage Growth Properties performed over the past 5 years?

-24.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SRG is currently unprofitable.

Growing Profit Margin: SRG is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: SRG is unprofitable, and losses have increased over the past 5 years at a rate of -24.3% per year.

Accelerating Growth: Unable to compare SRG's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: SRG is unprofitable, making it difficult to compare its past year earnings growth to the REITs industry (6.9%).


Return on Equity

High ROE: SRG has a negative Return on Equity (-12.88%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Seritage Growth Properties'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: SRG has a high level of physical assets or inventory.

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


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable SRG has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: SRG is unprofitable but has sufficient cash runway for more than 3 years, even with free cash flow being positive and shrinking by -33.2% per year.


Financial Institutions Analysis

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

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

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

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

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

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


Next Steps

Dividend

What is Seritage Growth Properties's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

company0%marketbottom25%1.4%markettop25%3.7%industryaverage3.5%forecastin3Yearsn/a

Current dividend yield vs market & industry

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

High Dividend: Unable to evaluate SRG'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 SRG's dividends per share have been stable in the past.

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


Current Payout to Shareholders

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


Future Payout to Shareholders

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


Next Steps

Management

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

1.8yrs

Average management tenure


CEO

Ben Schall (44yo)

US$8,872,766

Compensation

Mr. Benjamin W. Schall, also known as Ben, serves as the Chief Executive Officer, President of Seritage Growth Properties since 2015 and serves as its Trustee since July 6, 2015. Previously, Mr. Schall ser ...


CEO Compensation Analysis

Compensation vs Market: Ben's total compensation ($USD8.87M) is above average for companies of similar size in the US market ($USD3.82M).

Compensation vs Earnings: Ben's compensation has increased whilst the company is unprofitable.


Leadership Team

NamePositionTenureCompensationOwnership
Benjamin Schall
President0yrsUS$8.87m0.53% $10.9m
Brian Dickman
Executive VP & CFO5.1yrsUS$1.79m0.038% $776.3k
Kenneth Lombard
Executive VP & COO1.8yrsUS$1.28m0.0035% $72.0k
Matthew Fernand
Executive VP0yrsUS$1.62m0.039% $803.2k
James Bry
Executive Vice President of Development & Construction0.2yrsUS$1.17m0.0082% $169.6k
Mary Rottler
Executive Vice President of Leasing & Operations4.7yrsUS$1.20m0.025% $522.5k
Andrew Galvin
Senior Vice President of Investments & Portfolio Management1.1yrsno datano data
Maurice Funes
Senior Vice President of Leasing & Development0yrsno datano data
Paul D'Arelli
Senior Vice President of Development0yrsno datano data
Christopher Mrozinski
Senior Vice President0yrsno datano data

1.8yrs

Average Tenure

43.5yo

Average Age

Experienced Management: SRG's management team is not considered experienced ( 1.8 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Benjamin Schall
President0yrsUS$8.87m0.53% $10.9m
Thomas Steinberg
Independent Trustee4.6yrsUS$100.00k0.063% $1.3m
Edward Lampert
Chairman of the Board4.6yrsUS$100.00k1.76% $36.3m
Allison Thrush
Independent Trustee0.8yrsno datano data
John McClain
Independent Trustee4.6yrsUS$115.00k0.0071% $146.0k
Sharon Osberg
Independent Trustee1.8yrsUS$60.17k0.012% $252.8k
David Fawer
Independent Trustee4.6yrsUS$100.00k0.033% $673.9k

4.6yrs

Average Tenure

57yo

Average Age

Experienced Board: SRG's board of directors are considered experienced (4.6 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold 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 2.6%.


Top Shareholders

Company Information

Seritage Growth Properties's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Seritage Growth Properties
  • Ticker: SRG
  • Exchange: NYSE
  • Founded: 2015
  • Industry: Retail REITs
  • Sector: Real Estate
  • Implied Market Cap: US$2.069b
  • Market Cap: US$1.400b
  • Shares outstanding: 55.80m
  • Website: https://www.seritage.com

Number of Employees


Location

  • Seritage Growth Properties
  • 500 Fifth Avenue
  • Suite 1530
  • New York
  • New York
  • 10110
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SRGNYSE (New York Stock Exchange)YesClass A Common SharesUSUSDJul 2015
SRG.PRANYSE (New York Stock Exchange)7% CUM PFD SR AUSUSDDec 2017

Biography

Seritage Growth Properties is a publicly-traded, self-administered and self-managed REIT with 189 wholly-owned properties and 28 joint venture properties totaling approximately 34.4 million square feet of space across 44 states and Puerto Rico. The Company was formed to unlock the underlying real estate value of a high-quality retail portfolio it acquired from Sears Holdings in July 2015. Pursuant to a master lease, the Company has the right to recapture certain space from the successor to Sears Holdings for retenanting or redevelopment purposes. The Company’s mission is to create and own revitalized shopping, dining, entertainment and mixed-use destinations that provide enriched experiences for consumers and local communities, and create long-term value for our shareholders. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/21 01:46
End of Day Share Price2020/02/20 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.