Loading...
Docoh

Essential Properties Realty Trust (EPRT)

Essential Properties Realty Trust, Inc. is an internally managed REIT that acquires, owns and manages primarily single- tenant properties that are net leased on a long-term basis to companies operating service-oriented or experience-based businesses. As of December 31, 2020, the Company's portfolio consisted of 1,181 freestanding net lease properties with a weighted average lease term of 14.5 years and a weighted average rent coverage ratio of 2.9x. As of the same date, the Company's portfolio was 99.7% leased to 238 tenants operating 336 different concepts in 17 industries across 43 states.

Company profile

Ticker
EPRT
Exchange
CEO
Peter M. Mavoides
Employees
Incorporated
Location
Fiscal year end
SEC CIK
Subsidiaries
Essential Properties, L.P. • Essential Properties OP G.P., LLC • SCF TRS LLC • SCFRC-HW LLC • SCFRC-HW-V LLC • SCFRC-HW-G LLC • SCF RC Funding I LLC • SCF RC Funding II LLC • SCF RC Funding III LLC • SCF RC Funding IV LLC ...

EPRT stock data

Analyst ratings and price targets

Last 3 months

Calendar

28 Jul 22
1 Oct 22
31 Dec 22
Quarter (USD) Jun 22 Mar 22 Dec 21 Sep 21
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Annual (USD) Dec 21 Dec 20 Dec 19 Dec 18
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Cash burn rate (est.) Burn method: Change in cash Burn method: Operating income Burn method: FCF (opex + capex)
Last Q Avg 4Q Last Q Avg 4Q Last Q Avg 4Q
Cash on hand (at last report) 26.21M 26.21M 26.21M 26.21M 26.21M 26.21M
Cash burn (monthly) (no burn) 8.62M (no burn) (no burn) (no burn) (no burn)
Cash used (since last report) n/a 26.48M n/a n/a n/a n/a
Cash remaining n/a -268.09K n/a n/a n/a n/a
Runway (months of cash) n/a -0.0 n/a n/a n/a n/a

Beta Read what these cash burn values mean

Date Owner Security Transaction Code Indirect 10b5-1 $Price #Shares $Value #Remaining
15 Jun 22 Patten Mark E Common Stock Buy Acquire P No No 20.76 1,000 20.76K 84,453
13 Jun 22 Mavoides Peter M. Common Stock Buy Acquire P No No 20.68 20,000 413.6K 459,170
16 May 22 Estes Scott A Common Stock Grant Acquire A No No 0 4,323 0 91,166
16 May 22 Minich Lawrence J Common Stock Grant Acquire A No No 0 4,323 0 16,369
16 May 22 Neary Heather Leed Common Stock Grant Acquire A No No 0 4,323 0 15,469
97.0% owned by funds/institutions
13F holders Current Prev Q Change
Total holders 224 225 -0.4%
Opened positions 29 37 -21.6%
Closed positions 30 25 +20.0%
Increased positions 102 101 +1.0%
Reduced positions 74 66 +12.1%
13F shares Current Prev Q Change
Total value 4.01B 3.57B +12.2%
Total shares 129.64M 133.35M -2.8%
Total puts 19.3K 0 NEW
Total calls 4.1K 9.9K -58.6%
Total put/call ratio 4.7
Largest owners Shares Value Change
BLK Blackrock 24.05M $516.79M +8.2%
Vanguard 21.43M $460.53M +7.4%
Wellington Management 11.05M $237.55M -0.6%
STT State Street 7.82M $170.07M +6.8%
IVZ Invesco 4.79M $103M -0.3%
DB Deutsche Bank AG - Registered Shares 4.57M $98.29M -9.1%
TROW T. Rowe Price 3.39M $72.85M +4.2%
FMR 2.97M $63.92M +2.5%
Eaton Vance Management 2.72M $58.53M -0.2%
Geode Capital Management 2.65M $56.93M +3.9%
Largest transactions Shares Bought/sold Change
PGGM Investments 0 -5.62M EXIT
BLK Blackrock 24.05M +1.83M +8.2%
Vanguard 21.43M +1.49M +7.4%
PRU Prudential Financial 1.32M -1.19M -47.3%
Balyasny Asset Management 566.14K -1.1M -66.1%
GS Goldman Sachs 1.42M +583.89K +70.0%
STT State Street 7.82M +496.22K +6.8%
DB Deutsche Bank AG - Registered Shares 4.57M -458.08K -9.1%
Weiss Multi-Strategy Advisers 985.83K +382.23K +63.3%
Parametric Portfolio Associates 0 -326.15K EXIT

Financial report summary

?
Risks
  • We are subject to risks related to the ownership of commercial real estate that could adversely impact the value of our properties.
  • Adverse changes in the U.S., global and local markets and related economic and supply chain conditions may materially and adversely affect us and the ability of our tenants to make rental payments to us.
  • Our business is dependent upon our tenants successfully operating their businesses, and their failure to do so could materially and adversely affect us.
  • Our assessment that certain businesses are more insulated from e-commerce pressure than many others may prove to be incorrect, and changes in macroeconomic trends may adversely affect our tenants, either of which could impair our tenants' ability to make rental payments to us and materially and adversely affect us.
  • Properties occupied by a single tenant pursuant to a single-tenant lease subject us to significant risk of tenant default.
  • Periodically, we have experienced, and we may experience in the future, a decline in the fair value of our real estate assets, resulting in impairment charges that impact our financial condition and results of operations.
  • Geographic, industry and tenant concentrations reduce the diversity of our portfolio and make us more susceptible to adverse economic or regulatory developments in those areas or industries.
  • The vast majority of our properties are leased to unrated tenants whose credit is evaluated through our internal underwriting and credit analysis. However, the tools we use to measure credit quality, such as property-level rent coverage ratio, may not be accurate.
  • We may be unable to renew expiring leases with the existing tenants or re-lease the spaces to new tenants on favorable terms or at all.
  • The tenants that occupy our properties compete in industries that depend upon discretionary spending by consumers. A reduction in the willingness or ability of consumers to physically patronize and use their discretionary income in the businesses of our tenants and potential tenants could adversely impact our tenants’ business and thereby adversely impact our ability to collect rents and reduce the demand for our properties.
  • Our ability to realize future rent increases on some of our leases may vary depending on changes in the CPI.
  • Inflation may materially and adversely affect us and our tenants.
  • Some of our tenants operate under franchise or license agreements, and, if they are terminated or not renewed prior to the expiration of their leases with us, that would likely impair their ability to pay us rent.
  • Certain provisions of our leases may be unenforceable.
  • The bankruptcy or insolvency of a tenant could result in the termination or modification of such tenant's lease and material losses to us.
  • Property vacancies could result in us having to incur significant capital expenditures to re-tenant the properties.
  • Defaults by borrowers on loans we hold could lead to losses.
  • We may be unable to identify and complete acquisitions of suitable properties, which may impede our growth, and our future acquisitions may not yield the returns we seek.
  • Our real estate investments are generally illiquid which could significantly impede our ability to respond to market conditions or adverse changes in the performance of our tenants or our properties and which would harm our financial condition.
  • Our growth depends on third-party sources of capital that are outside of our control and may not be available to us on commercially reasonable terms or at all.
  • Loss of senior executives with long-standing business relationships could materially impair our ability to operate successfully.
  • The costs of compliance with or liabilities related to environmental laws may materially and adversely affect us.
  • Insurance on our properties may not adequately cover all losses and uninsured losses could materially and adversely affect us.
  • Compliance with the ADA and fire, safety and other regulations may require us to make unanticipated expenditures.
  • Our operations and financial condition may be adversely affected by climate change, including possible changes in weather patterns, weather-related events, government policy, laws, regulations and economic conditions.
  • As of December 31, 2021, we had $1.2 billion of indebtedness outstanding, which requires substantial cash flow to service, subjects us to covenants and refinancing risk and the risk of default.
  • Our business plan depends on external sources of capital, including debt financings, and market conditions could adversely affect our ability to refinance existing indebtedness or obtain additional financing for growth on commercially acceptable terms or at all.
  • A downgrade in our credit ratings could have a material adverse effect on our business and financial condition.
  • We have engaged in hedging transactions and may engage in additional hedging transactions in the future; such transactions may materially and adversely affect our results of operations and cash flows.
  • LIBOR is being discontinued as a floating rate benchmark; Secured Overnight Financing Rate (“SOFR”) is expected to replace LIBOR as the principal floating rate benchmark; the LIBOR discontinuation has affected and will continue to affect financial markets generally and may also affect our operations specifically.
  • Our debt financing agreements contain restrictions and covenants which may limit our ability to enter into, or obtain funding for, certain transactions, operate our business or make distributions to our common stockholders.
  • Mortgage debt obligations expose us to the possibility of foreclosure, which could result in the loss of our investment in any property subject to mortgage debt.
  • Our charter and bylaws and Maryland law contain provisions that may delay, defer or prevent a change of control transaction, even if such a change in control may be in your interest, and as a result may depress the market price of our common stock. Our charter contains certain restrictions on ownership and transfer of our stock.
  • We could increase or decrease the number of authorized shares of stock, classify and reclassify unissued stock and issue stock without stockholder approval.
  • Our bylaws designate the Circuit Court for Baltimore City, Maryland as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit stockholders' ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees and could discourage lawsuits against us and our directors, officers and employees.
  • Termination of the employment agreements with certain members of our senior management team could be costly and could prevent a change in control of our company.
  • Our board of directors may change our investment and financing policies without stockholder approval, including those with respect to borrowing, and we may become more highly leveraged, which may increase our risk of default under our debt obligations.
  • Our rights and the rights of our stockholders to take action against our directors and officers are limited.
  • We are a holding company with no direct operations and rely on funds received from our Operating Partnership to make any distributions to stockholders and to pay liabilities.
  • Conflicts of interest could arise in the future between the interests of our stockholders and the interests of holders of units in our Operating Partnership, which may impede business decisions that could benefit our stockholders.
  • Certain mergers, consolidations and other transactions require the approval of a majority in interest of the outside limited partners in our Operating Partnership (which excludes us and our subsidiaries), which could prevent certain transactions that may result in our stockholders receiving a premium for their shares or otherwise be in their best interest.
  • Failure to continue to qualify as a REIT would materially and adversely affect us and the value of our common stock, and even if we continue to qualify as a REIT, we may be subject to certain additional taxes.
  • If our Operating Partnership fails to qualify as a partnership for federal income tax purposes, we will cease to qualify as a REIT and suffer other adverse consequences.
  • To maintain our REIT status, we may be forced to borrow funds during unfavorable market conditions, and the unavailability of such capital on favorable terms at the desired times, or at all, may cause us to curtail our investment activities and/or to dispose of assets at inopportune times.
  • Our ability to provide certain services to our tenants may be limited by the REIT rules or may have to be provided through a taxable REIT subsidiary.
  • The IRS may treat sale-leaseback transactions as loans, which could jeopardize our REIT status or require us to make an unexpected distribution.
  • Dividends payable by REITs do not qualify for the reduced tax rates available for some dividends.
  • The tax imposed on REITs engaging in “prohibited transactions” may limit our ability to engage in transactions which would be treated as sales for federal income tax purposes.
  • Complying with REIT requirements may limit our ability to hedge effectively and may cause us to incur tax liabilities.
  • Complying with REIT requirements may affect our profitability and may force us to liquidate or forgo otherwise attractive investments.
  • There is a risk of changes in the tax law applicable to REITs.
  • Changes in market conditions and volatility of stock prices could adversely affect the market price of our common stock.
  • Increases in market interest rates may result in a decrease in the value of shares of our common stock.
  • We may be unable to continue to make distributions at our current distribution level, and our board may change our distribution policy in the future.
  • The incurrence of additional debt, which would be senior to shares of our common stock upon liquidation, and/or preferred equity securities that may be senior to shares of our common stock for purposes of distributions or upon liquidation, may materially and adversely affect the market price of shares of our common stock.
  • Sales of substantial amounts of our common stock or securities convertible into or exercisable or exchangeable therefor, or the perception that such sales might occur, could reduce the price of our common stock and may dilute your voting power and your ownership interest in us.
  • Any material failure, weakness, interruption or breach in security of our information systems could prevent us from effectively operating our business.
  • We are subject to litigation, which could materially and adversely affect us.
  • Material weaknesses in or a failure to maintain an effective system of internal control over financial reporting or disclosure controls could prevent us from accurately and timely reporting our financial results, which could materially and adversely affect us.
  • Changes in accounting standards may materially and adversely affect us.
Management Discussion
  • Rental revenue. Rental revenue increased by $13.9 million for the three months ended June 30, 2022 as compared to the three months ended June 30, 2021. The increase in rental revenue was driven primarily by the growth in our real estate investment portfolio. Our real estate investment portfolio grew from 1,325 rental properties, representing $2.7 billion in net investments in real estate, as of June 30, 2021 to 1,391 rental properties, representing $3.4 billion in net investments in real estate, as of June 30, 2022. Our real estate investments were acquired throughout the periods presented and were not all owned by us for the entirety of the applicable periods; accordingly, a significant portion of the increase in rental revenue between periods is related to recognizing revenue in 2022 from acquisitions that were made during 2021 and early 2022. Another component of the increase in rental revenues between periods relates to rent escalations recognized on our leases.

Content analysis

?
Positive
Negative
Uncertain
Constraining
Legalese
Litigous
Readability
H.S. junior Avg
New words: Agent, Ann, Arbor, Chicken, delivery, Fargo, fewer, Furnishing, GA, Home, MI, moving, occasionally, physical, physically, Pickle, reoccur, reset, Restaurant, tranche, underwritten, Warner
Removed: behavior, certainty, collect, consolidate, decline, defer, deferral, Delta, derecognized, distribution, exacerbate, force, government, hesitancy, instability, intensify, judged, largely, negotiated, outbreak, patronage, persist, pledged, predicted, prolong, prolonged, reconsideration, remained, request, returned, revised, secular, supply, temporary, trustee, unwilling, vaccine, variant, World