Breaking Down Franklin Street Properties Corp. (FSP) Financial Health: Key Insights for Investors

Are you keeping a close watch on your investments and wondering about the financial stability of Franklin Street Properties Corp (FSP)? In 2024, FSP faced a GAAP net loss of $52.7 million, or $0.51 per share, and the Funds From Operations (FFO) reached $13.3 million, or $0.13 per share. With a portfolio that was 70.3% leased as of December 31, 2024, compared to 74.0% the previous year, how is FSP adapting its strategies to navigate the current real estate landscape, and what does this mean for investors like you?

Franklin Street Properties Corp. (FSP) Revenue Analysis

Understanding Franklin Street Properties Corp.'s (FSP) revenue streams is crucial for investors seeking insights into the company's financial health. As a real estate investment trust (REIT), FSP's revenue is primarily derived from its portfolio of office properties located in the U.S. Sunbelt and Mountain West.

Here's a breakdown of FSP's primary revenue sources and related analysis:

• Rental Income from Real Estate Leasing: This constitutes the majority of FSP's revenue. As of December 31, 2024, FSP's directly-owned real estate portfolio comprised 14 properties, totaling approximately 4.8 million square feet. The portfolio was approximately 70.3% leased, compared to approximately 74.0% leased as of December 31, 2023. The decrease in the leased percentage is primarily a result of three property dispositions and lease expirations.
• Property Dispositions: FSP engages in the sale of properties as part of its capital allocation strategy. In 2024, FSP completed the sale of three properties for total gross proceeds of approximately $100 million. Since December 2020, property dispositions have generated aggregate gross proceeds of approximately $1.1 billion.
• Fee Income from Asset/Property Management and Development: FSP also earns revenue from managing properties and providing development services.

Analyzing the year-over-year revenue growth rate provides insights into FSP's performance and trends.

Here's a look at FSP's revenue performance from 2015-2024:

In 2024, Franklin Street Properties had annual revenue of $120.11M, a decrease of -17.57% compared to the previous year. This decline reflects the challenges FSP faces, including property dispositions and lease expirations. The company's revenue was $28.38M in the quarter ending December 31, 2024, a decrease of -18.39%.

FSP operates in one segment, which is real estate operations. The company's investment objectives are to create shareholder value by increasing revenue from rental, dividend, interest, and fee income, and net gains from sales of properties.

For more insights into FSP's strategic vision, explore Mission Statement, Vision, & Core Values of Franklin Street Properties Corp. (FSP).

Franklin Street Properties Corp. (FSP) Profitability Metrics

Analyzing the profitability of Franklin Street Properties Corp. (FSP) provides key insights into its financial health and operational efficiency. A review of gross profit, operating profit, and net profit margins, alongside a comparison with industry averages, helps investors gauge the company's performance.

Here's a breakdown of FSP's profitability metrics based on the available 2024 data:

A closer look at the historical data reveals the trends in Franklin Street Properties Corp.'s profitability:

The decrease in the leased percentage is primarily a result of three property dispositions and lease expirations. During the twelve months ended December 31, 2024, the company leased approximately 616,000 square feet, including 171,000 square feet of new leases. The directly-owned real estate portfolio of 14 owned properties, totaling approximately 4.8 million square feet, was approximately 70.3% leased as of December 31, 2024, compared to approximately 74.0% leased as of December 31, 2023.

Here's an overview of Franklin Street Properties' operational efficiency strategies:

• Cost Management: Total expenses decreased to $152.8 million from $171.0 million, attributed to lower real estate operating expenses and depreciation from property dispositions.
• Debt Reduction: On February 21, 2024, the company repaid approximately $102 million of its debt. As of December 31, 2024, total indebtedness was approximately $250.3 million, equivalent to approximately $52 per square foot on the remaining approximately 4.8 million square foot directly-owned property portfolio.
• Property Dispositions: During the first quarter of 2024, Franklin Street Properties sold an office property located in Richardson, Texas, known as Collins Crossing, for gross proceeds of approximately $35 million. On October 23, 2024, the company completed the sale of its last property in Atlanta, Georgia, known as Pershing Park Plaza, for a gross selling price of $34 million.

To gain further insights into the investors of Franklin Street Properties Corp. (FSP), consider exploring this resource: Exploring Franklin Street Properties Corp. (FSP) Investor Profile: Who’s Buying and Why?

Franklin Street Properties Corp. (FSP) Debt vs. Equity Structure

Understanding how Franklin Street Properties Corp. (FSP) finances its operations and growth is crucial for investors. This involves analyzing the company's debt levels, its debt-to-equity ratio, and how it strategically uses debt and equity.

As of the fiscal year 2024, Franklin Street Properties Corp. (FSP) exhibits the following debt profile:

• Long-term debt: Specific figures for long-term debt would be detailed in their financial statements.
• Short-term debt: Specific figures for short-term debt would be detailed in their financial statements.

The debt-to-equity ratio is a key metric to gauge financial leverage. It indicates the proportion of debt and equity the company uses to finance its assets. A lower ratio generally suggests less risk. For Franklin Street Properties Corp. (FSP):

• Debt-to-equity ratio: The specific ratio for 2024 can be calculated using the total liabilities and shareholders' equity from the balance sheet.
• Industry comparison: This ratio should be compared against industry averages to determine if Franklin Street Properties Corp. (FSP)'s leverage is typical or if it deviates significantly.

Recent activities such as debt issuances, credit ratings, or refinancing can provide insights into the company's financial strategy and health. For Franklin Street Properties Corp. (FSP):

• Recent debt activities: Any recent debt issuances or refinancing activities would be detailed in their financial releases.
• Credit ratings: Current credit ratings from agencies like Moody's or S&P would reflect their assessment of Franklin Street Properties Corp. (FSP)'s creditworthiness.

Balancing debt and equity is vital for sustainable growth. Franklin Street Properties Corp. (FSP) needs to strategically manage its capital structure to optimize financial flexibility and minimize risk.

Here's an illustrative table showcasing how debt and equity components might look (Note: This is sample data and not actual FSP data):

Understanding these elements helps stakeholders assess the financial risk and stability of Franklin Street Properties Corp. (FSP). For more insights into the company's core values and strategic direction, refer to Mission Statement, Vision, & Core Values of Franklin Street Properties Corp. (FSP).

Franklin Street Properties Corp. (FSP) Liquidity and Solvency

When evaluating the financial health of Franklin Street Properties Corp. (FSP), understanding its liquidity and solvency is crucial for investors. These metrics provide insights into the company's ability to meet its short-term obligations and long-term financial stability. Here's an overview of FSP's liquidity position:

Assessing Franklin Street Properties Corp.'s Liquidity:

Liquidity ratios measure a company's ability to pay off its short-term debts using its current assets. Here's how Franklin Street Properties Corp. (FSP) stacks up:

• Current Ratio: As of the most recent quarter (December 31, 2024), the current ratio for Franklin Street Properties Corp. (FSP) was 2.17. A current ratio of above 1 indicates that a company is in good financial health.
• Quick Ratio: The quick ratio, which excludes inventories from current assets, provides a more conservative view of liquidity. For Franklin Street Properties Corp. (FSP), the quick ratio as of December 31, 2024, was 1.38. The quick ratio for December 31, 2023, was 2.35.

These ratios suggest that Franklin Street Properties Corp. (FSP) has a reasonable ability to cover its short-term liabilities with its most liquid assets.

Analysis of Working Capital Trends

Working capital, which is the difference between a company's current assets and current liabilities, is a measure of its short-term financial health. Franklin Street Properties Corp.'s change in net working capital has fluctuated over the past few years. The median change in net working capital from fiscal years ending December 2020 to 2024 was -1.099 million.

As of December 31, 2024, Franklin Street Properties Corp. (FSP) had a working capital of 47.626 million.

Cash Flow Statements Overview

An examination of cash flow statements reveals how Franklin Street Properties Corp. (FSP) generates and uses cash. There are three primary categories:

• Operating Activities: This section shows the cash generated from the company's core business operations.
• Investing Activities: This includes cash flow from the purchase and sale of assets, such as properties and equipment.
• Financing Activities: This involves cash flow from debt, equity, and dividends.

For the year 2024, Franklin Street Properties Corp. (FSP) had an operating cash flow of 8.99 million.

Debt and Indebtedness

Total indebtedness as of December 31, 2024, was approximately $250.3 million, which is equivalent to about $52 per square foot of their remaining 4.8 million square foot directly-owned property portfolio.

On October 25, 2024, Franklin Street Properties Corp. (FSP) repaid approximately $27.4 million of debt using proceeds from the sale of Pershing Park Plaza.

Potential Liquidity Concerns or Strengths

While Franklin Street Properties Corp. (FSP) appears to have sufficient liquidity based on its current and quick ratios, there are some factors to consider:

• Leasing Activity: During 2024, Franklin Street Properties Corp. (FSP) leased approximately 616,000 square feet, including 171,000 square feet of new leases. The real estate portfolio was approximately 70.3% leased as of December 31, 2024, compared to approximately 74.0% as of December 31, 2023.
• Property Dispositions: On October 23, 2024, Franklin Street Properties Corp. (FSP) completed the sale of its last property in Atlanta, Georgia, known as Pershing Park Plaza, for a gross selling price of $34 million.
• Net Loss: Franklin Street Properties Corp. (FSP) reported a GAAP net loss of $52.7 million, or $0.51 per basic and diluted share, for the year ended December 31, 2024.
• Debt Maturity: All of Franklin Street Properties Corp.'s debt now matures on April 1, 2026, after amendments to outstanding debt facilities on February 21, 2024.

For additional insights into Franklin Street Properties Corp.'s mission, vision, and core values, you can visit: Mission Statement, Vision, & Core Values of Franklin Street Properties Corp. (FSP).

Franklin Street Properties Corp. (FSP) Valuation Analysis

Determining whether Franklin Street Properties Corp. (FSP) is overvalued or undervalued involves analyzing several key financial ratios and indicators.

Here's a breakdown:

• Price-to-Earnings (P/E) Ratio: As of April 2025, FSP's P/E ratio is reported as -3.59. A negative P/E ratio suggests that the company has negative earnings, which means it is currently not profitable.
• Price-to-Book (P/B) Ratio: FSP's P/B ratio is 0.29. A P/B ratio of less than 1 can indicate that a stock is undervalued, as it means that the market capitalization is less than the book value of the company's assets.
• Enterprise Value-to-EBITDA (EV/EBITDA): FSP's EV/EBITDA ratio is 18.29. The EV/EBITDA ratio compares a company's enterprise value to its earnings before interest, taxes, depreciation, and amortization (EBITDA). It's used to assess the fair value of a company.

Analyzing Franklin Street Properties Corp.'s (FSP) stock price trends, dividend yield, and analyst consensus provides a more comprehensive valuation perspective.

• Stock Price Trends: Over the last 52 weeks, Franklin Street Properties Corp.'s (FSP) stock price has decreased by -30.14%. The stock has been trading between $1.36 and $2.21 over the past year.
• Dividend Yield and Payout Ratios: Franklin Street Properties Corp. (FSP) pays an annual dividend of $0.04, resulting in a dividend yield of 2.63%.
• Analyst Consensus: The average analyst price target for Franklin Street Properties Corp. (FSP) is $2.00, which represents a potential upside of 36.99% from the current price. The consensus rating is 'Hold'.

Here's a summary of key valuation ratios for Franklin Street Properties Corp. (FSP):

Additionally, key financial metrics for Franklin Street Properties Corp. (FSP) include:

• Market Cap: $157.94 million
• Enterprise Value: $361.86 million
• Revenue: $120.47 million
• Net Income: -$52.72 million

For more insights into Franklin Street Properties Corp.'s (FSP) mission, vision, and core values, you can visit: Mission Statement, Vision, & Core Values of Franklin Street Properties Corp. (FSP).

Franklin Street Properties Corp. (FSP) Risk Factors

Franklin Street Properties Corp. (FSP) faces a variety of internal and external risks that could significantly impact its financial health. These risks span industry competition, regulatory changes, and broader market conditions, all of which demand careful consideration.

Here's a breakdown of key risk areas:

• Industry Competition: The commercial real estate sector is highly competitive. FSP faces competition in attracting and retaining tenants, which can impact occupancy rates and rental income.
• Regulatory Changes: Changes in zoning laws, environmental regulations, or tax policies can affect the value and operating costs of FSP's properties.
• Market Conditions: Economic downturns, rising interest rates, and shifts in demand for office space can negatively impact FSP's financial performance.

Operational, financial, and strategic risks are often highlighted in Franklin Street Properties Corp.'s (FSP) earnings reports and filings. These can include:

• Operational Risks: These involve property management challenges, such as maintaining building quality, addressing tenant needs, and managing operating expenses efficiently.
• Financial Risks: These include managing debt levels, refinancing risks, and the ability to generate sufficient cash flow to cover operating expenses and debt service.
• Strategic Risks: These relate to investment decisions, such as acquiring or disposing of properties, and adapting to changing market trends.

Mitigation strategies are crucial for addressing these risks. While specific plans can vary, common strategies include:

• Diversification: Diversifying the property portfolio by geography and tenant base can reduce the impact of localized economic downturns or the loss of a major tenant.
• Proactive Leasing: Engaging in proactive leasing efforts to maintain high occupancy rates and attract quality tenants.
• Cost Management: Implementing cost-effective property management practices to control operating expenses.
• Financial Prudence: Maintaining a strong balance sheet with manageable debt levels and access to capital.

Understanding these risks and mitigation strategies is essential for investors assessing the financial health and stability of Franklin Street Properties Corp. (FSP). Learn more about FSP investors: Exploring Franklin Street Properties Corp. (FSP) Investor Profile: Who’s Buying and Why?

Franklin Street Properties Corp. (FSP) Growth Opportunities

For investors eyeing Franklin Street Properties Corp. (FSP), understanding the company's potential for future growth is crucial. Let's delve into the key factors that could shape FSP's trajectory in the coming years.

As of now, pinpointing specific future growth drivers for Franklin Street Properties Corp. (FSP) requires a thorough examination of its strategic initiatives, market positioning, and recent financial performance. While detailed information on product innovations or specific acquisitions is not readily available, we can assess potential growth avenues based on industry trends and the company's existing operations.

Given the available information up to April 2025, here are potential areas that could influence FSP's future growth:

• Market Dynamics: Analyzing the demand for office spaces in the regions where FSP operates is essential. Shifts in remote work trends, economic growth, and industry-specific expansions or contractions can significantly impact occupancy rates and rental income.
• Strategic Repositioning: FSP might focus on repositioning its assets to cater to evolving tenant needs. This could involve upgrading properties, offering flexible lease terms, or attracting tenants in high-growth sectors.
• Cost Management: Efficient cost management and debt reduction can improve FSP's financial flexibility, enabling it to pursue growth opportunities or navigate challenging market conditions.

Future revenue growth projections and earnings estimates for Franklin Street Properties Corp. (FSP) are not explicitly available. Independent investment research firms or financial analysts typically provide these estimates. To gain insights into potential revenue growth, investors should consult these sources, keeping in mind that estimates are subject to change based on market conditions and company performance.

Information regarding strategic initiatives or partnerships that may drive future growth for FSP is limited. However, the company's focus on a specific type of real estate (office properties) could allow it to develop specialized expertise and relationships that create a competitive advantage. Actively managing and adapting their portfolio to meet market demands is crucial for maintaining and improving their competitive position.

Understanding FSP's competitive advantages requires a careful look at its portfolio composition, tenant base, and operational efficiency. Factors that could differentiate FSP from its competitors include:

• Location of Properties: Properties in high-demand locations with strong transportation links and access to amenities may command higher rental rates and attract quality tenants.
• Tenant Relationships: Strong relationships with creditworthy tenants can provide stable cash flow and reduce vacancy risk.
• Operational Expertise: Efficient property management and cost control can improve profitability and enhance shareholder value.

For a deeper understanding of the investors profile, consider reading: Exploring Franklin Street Properties Corp. (FSP) Investor Profile: Who’s Buying and Why?