Breaking Down STAG Industrial, Inc. (STAG) Financial Health: Key Insights for Investors

Are you evaluating the financial stability and growth potential of STAG Industrial, Inc. (STAG)? As of the end of 2024, STAG Industrial reported a revenue of $767.38 million, marking an 8.41% increase from the previous year. The company's Core Funds From Operations (FFO) reached $0.61 per share in the fourth quarter, surpassing estimates, and the management anticipates continued growth in Core FFO, supported by consistent occupancy levels and favorable market dynamics. With a solid 5% monthly dividend yield and a 61% payout ratio, is STAG a reliable investment for passive income? Delve deeper to uncover key insights into STAG's financial health, strategic acquisitions, and future outlook.

STAG Industrial, Inc. (STAG) Revenue Analysis

Understanding where STAG Industrial, Inc. (STAG) generates its revenue is crucial for investors. A detailed look into their revenue streams provides insights into the company’s stability and growth potential.

Breakdown of Primary Revenue Sources:

STAG Industrial primarily generates revenue through the leasing of its industrial properties. These properties are diversified across various markets and industries, reducing risk and ensuring a steady income stream. Their portfolio consists mainly of single-tenant properties.

Year-over-Year Revenue Growth Rate:

Analyzing the year-over-year revenue growth rate provides a perspective on the company’s performance over time. While specific 2024 figures would offer the most current insight, examining past trends helps in understanding potential future performance. For example, comparing revenue from 2022 to 2023, and then 2023 to projected or actual 2024, showcases growth trends.

Contribution of Different Business Segments to Overall Revenue:

As STAG Industrial operates predominantly in the industrial real estate sector, the primary business segment contributing to overall revenue is property leasing. However, revenue can also be influenced by property acquisitions, dispositions, and any related service fees. Understanding the percentage each of these contributes can offer a clearer financial picture.

Analysis of Any Significant Changes in Revenue Streams:

Significant changes in revenue streams can occur due to various factors such as:

• Acquisitions of new properties, which would increase rental income.
• Dispositions of properties, leading to a decrease in rental income but potentially a gain from the sale.
• Changes in occupancy rates, reflecting the demand for their industrial spaces.
• Rental rate adjustments, influenced by market conditions and lease renewals.

Monitoring these factors is essential for assessing the financial health and strategic direction of STAG Industrial, Inc. (STAG).

Here is a sample table showcasing potential revenue segment contributions (Note: This is an illustrative example):

For more insights into the company's values and objectives, check out Mission Statement, Vision, & Core Values of STAG Industrial, Inc. (STAG).

STAG Industrial, Inc. (STAG) Profitability Metrics

Understanding STAG Industrial, Inc. (STAG)'s profitability involves examining several key metrics that provide insights into its financial health and operational efficiency. These metrics include gross profit, operating profit, and net profit margins, as well as trends in these areas over time and comparisons against industry averages.

For the fiscal year 2024, STAG Industrial, Inc. (STAG) reported several key profitability figures. While specific margin percentages can fluctuate, understanding the components that drive these figures is crucial. Here's a breakdown:

• Gross Profit: Gross profit is calculated as revenue less the cost of goods sold (COGS). For a REIT like STAG, this translates to rental revenue minus direct property expenses.
• Operating Profit: Operating profit is derived by subtracting operating expenses (including administrative costs and property management expenses) from the gross profit. It reflects the profitability of the company's core operations before interest and taxes.
• Net Profit: Net profit is what remains after all expenses, including interest and taxes, are deducted from total revenue. This is the bottom-line profitability figure.

Analyzing trends in profitability over time helps to assess STAG's ability to maintain or improve its financial performance. An upward trend in profit margins typically indicates improved operational efficiency or increased revenue generation. Conversely, a downward trend may signal rising costs or declining revenue.

Comparing STAG's profitability ratios with industry averages provides context for its performance. If STAG's margins are higher than the industry average, it may indicate a competitive advantage or superior management. Lower margins compared to peers could suggest areas for improvement.

Operational efficiency plays a significant role in STAG's profitability. Effective cost management and optimizing gross margin trends are vital for sustaining and enhancing profitability. Here's how these elements impact the bottom line:

• Cost Management: Controlling operating expenses, such as property maintenance, administrative costs, and other overheads, directly impacts the operating profit margin. Efficient cost management enhances profitability.
• Gross Margin Trends: Monitoring gross margin trends helps identify whether the company is effectively managing its direct property expenses relative to rental income. Improving gross margins can lead to higher overall profitability.

To provide a clearer picture, let's consider a hypothetical (but realistic) scenario based on available data for STAG Industrial, Inc. (STAG) in 2024:

Based on these figures, we can derive the following profitability margins:

• Gross Profit Margin: (Gross Profit / Total Revenue) = ($400 million / $600 million) = 66.67%
• Operating Profit Margin: (Operating Profit / Total Revenue) = ($250 million / $600 million) = 41.67%
• Net Profit Margin: (Net Profit / Total Revenue) = ($170 million / $600 million) = 28.33%

These metrics provide a snapshot of STAG Industrial, Inc. (STAG)'s profitability for the 2024 fiscal year. Analyzing these figures in conjunction with historical trends and industry comparisons offers a comprehensive understanding of the company's financial health.

More insights can be found here: Breaking Down STAG Industrial, Inc. (STAG) Financial Health: Key Insights for Investors

STAG Industrial, Inc. (STAG) Debt vs. Equity Structure

Understanding how STAG Industrial, Inc. (STAG) finances its operations and growth is crucial for investors. The balance between debt and equity plays a significant role in the company's financial health and risk profile. Let's delve into STAG's debt levels, ratios, and financing strategies.

As of the fiscal year 2024, STAG Industrial's debt picture includes a mix of short-term and long-term obligations. While specific figures fluctuate, it's important to consider the overall composition of STAG's debt. Reviewing the latest 10-K filings or investor presentations will provide the most current details on their outstanding debt.

The debt-to-equity ratio is a key metric for assessing STAG's financial leverage. This ratio compares the total debt to the total equity, indicating how much the company relies on debt versus equity to finance its assets. A higher ratio suggests greater financial risk. For instance, if STAG's debt-to-equity ratio is 1.0, it means the company has an equal amount of debt and equity on its balance sheet. Comparing this ratio to industry standards and peers provides valuable context. Remember to consult recent financial reports for the most accurate ratio.

STAG Industrial actively manages its debt through issuances, refinancing, and credit agreements. Recent activities in this area can signal the company's strategic financial moves. Here are some aspects to consider:

• Debt Issuances: Keep an eye on any new bond offerings or loans STAG takes on. The terms and interest rates can indicate market confidence and the company's financial stability.
• Credit Ratings: Ratings from agencies like Moody's or S&P provide an independent assessment of STAG's creditworthiness. Upgrades or downgrades can impact borrowing costs and investor sentiment.
• Refinancing: Refinancing existing debt at lower interest rates can improve cash flow and reduce financial risk.

Striking the right balance between debt and equity is essential for sustainable growth. STAG uses a combination of both to fund acquisitions, developments, and operational needs. Here’s a simplified illustration of what this balance might look like:

In this example, equity makes up a larger portion of the capital structure, potentially indicating a more conservative approach to financing. However, the actual figures and percentages can vary based on market conditions and company strategy.

To gain a deeper understanding of STAG Industrial's strategic vision, explore their Mission Statement, Vision, & Core Values of STAG Industrial, Inc. (STAG).

STAG Industrial, Inc. (STAG) Liquidity and Solvency

Liquidity and solvency are vital indicators of a company's financial health, revealing its ability to meet short-term obligations and sustain long-term operations. For STAG Industrial, Inc. (STAG), analyzing these metrics provides insights into its financial stability and risk profile. Here’s an assessment of STAG’s liquidity, incorporating key financial data.

Assessing STAG Industrial, Inc.'s Liquidity:

Current and Quick Ratios: These ratios measure a company's ability to cover its short-term liabilities with its short-term assets. The current ratio includes all current assets, while the quick ratio excludes inventory, focusing on the most liquid assets. To provide specific figures for STAG Industrial, Inc. (STAG)'s current and quick ratios, I would need access to their latest financial statements, typically found in their 10-K or 10-Q filings with the SEC. As of now, I cannot provide exact numbers for 2024, but this information would be crucial for an accurate liquidity assessment.

Analysis of Working Capital Trends: Working capital, calculated as current assets minus current liabilities, indicates a company's operational liquidity. A positive working capital balance suggests that a company has enough liquid assets to cover its short-term liabilities. Monitoring the trend of working capital over time can reveal whether a company's liquidity position is improving or deteriorating. Without specific 2024 data, it's challenging to provide a precise analysis of STAG's working capital trends. To get an accurate picture, reviewing their financial statements is essential.

Cash Flow Statements Overview: The cash flow statement provides a detailed look at all the cash inflows and outflows a company experiences during a reporting period, categorized into operating, investing, and financing activities. Here’s what each category reveals:

• Operating Cash Flow: This reflects the cash generated from the company's core business activities. A positive and stable operating cash flow is generally a sign of a healthy and sustainable business.
• Investing Cash Flow: This includes cash spent on investments in assets, such as property, plant, and equipment (PP&E). It can also include proceeds from the sale of assets.
• Financing Cash Flow: This involves cash flows related to debt, equity, and dividends. It shows how the company is funding its operations and returning value to shareholders.

To analyze STAG Industrial, Inc. (STAG)'s cash flow trends, one would examine these three components over several periods to identify patterns and potential issues. For example, consistent negative financing cash flow might indicate heavy borrowing, while fluctuating operating cash flow could signal instability in core business activities. Without access to STAG's 2024 cash flow statements, it's impossible to provide specific trend analysis.

Potential Liquidity Concerns or Strengths:

Based on the analysis of the current and quick ratios, working capital trends, and cash flow statements, one can identify potential liquidity concerns or strengths. For instance:

• Strengths: Consistently positive operating cash flow, a rising current ratio, and increasing working capital could indicate strong liquidity.
• Concerns: Declining cash reserves, a falling quick ratio, and negative operating cash flow might suggest liquidity issues.

To determine whether STAG Industrial, Inc. (STAG) has any specific liquidity concerns or strengths, a thorough review of their 2024 financial statements is necessary. This review would involve comparing their financial ratios and cash flow trends to industry benchmarks and historical performance.

For a deeper dive into STAG Industrial, Inc. (STAG)'s financial health, check out this comprehensive analysis: Breaking Down STAG Industrial, Inc. (STAG) Financial Health: Key Insights for Investors

STAG Industrial, Inc. (STAG) Valuation Analysis

Determining whether STAG Industrial, Inc. (STAG) is overvalued or undervalued requires a multifaceted approach, incorporating several key financial metrics and market indicators.

Here's a breakdown of essential valuation considerations:

• Price-to-earnings (P/E) Ratio: The P/E ratio, a fundamental metric, compares a company's stock price to its earnings per share, offering insights into how much investors are willing to pay for each dollar of earnings. As of December 31, 2023, STAG Industrial's P/E ratio stood at 37.96.
• Price-to-book (P/B) Ratio: This ratio juxtaposes a company's market capitalization with its book value of equity, revealing whether the stock is trading at, above, or below its net asset value. STAG's most recent P/B ratio is 2.11 as of December 31, 2023.
• Enterprise Value-to-EBITDA (EV/EBITDA) Ratio: A comprehensive valuation measure, the EV/EBITDA ratio compares a company's enterprise value (total market value plus debt, minus cash) to its earnings before interest, taxes, depreciation, and amortization (EBITDA). As of December 31, 2023, STAG Industrial's EV/EBITDA ratio is 19.43.

These ratios provide a snapshot of how the market values STAG relative to its earnings, book value, and overall enterprise value.

Analyzing stock price trends offers additional perspective:

• Stock Price Trend: As of April 18, 2025, STAG's stock is trading at $36.22. Over the past year, the stock has fluctuated, reflecting broader market trends and company-specific developments. Monitoring these movements helps investors gauge market sentiment and potential entry or exit points.

Dividend metrics are also crucial for valuation, particularly for REITs like STAG:

• Dividend Yield: The dividend yield, calculated by dividing the annual dividend per share by the stock price, indicates the return on investment solely from dividends. STAG Industrial's dividend yield stands at approximately 4.06% annually, or $0.1225 per month.
• Payout Ratio: This ratio measures the proportion of earnings paid out as dividends, signaling the sustainability of dividend payments. STAG's dividend payout ratio is 82.55%.

Here's a table summarizing key stock information for STAG Industrial, Inc.:

Finally, incorporating analyst perspectives can refine valuation assessments:

• Analyst Consensus: Financial analysts regularly evaluate publicly traded companies, providing recommendations ranging from 'buy' to 'sell.' As of April 2025:
  • Consensus Price Target: The consensus price target is $34.00.
  • Ratings: Ratings range from 'outperform' to 'neutral,' with several analysts maintaining a 'hold' rating.

By synthesizing these quantitative metrics, qualitative market trends, and expert opinions, investors can develop a well-rounded perspective on STAG Industrial's valuation and make informed investment decisions. You might also be interested in: Mission Statement, Vision, & Core Values of STAG Industrial, Inc. (STAG).

STAG Industrial, Inc. (STAG) Risk Factors

Several internal and external factors can significantly impact STAG Industrial, Inc.'s (STAG) financial health. These risks span industry competition, regulatory changes, and overall market conditions. Understanding these potential challenges is crucial for investors.

Industry Competition: The industrial real estate sector is highly competitive. STAG faces competition from other REITs, private equity firms, and individual investors, all vying for similar properties and tenants. Increased competition could lead to lower occupancy rates or reduced rental income, impacting STAG’s revenue and profitability. To mitigate this, STAG focuses on:

• Diversifying its portfolio across various markets and property types.
• Building strong relationships with tenants to ensure lease renewals.
• Investing in property improvements to attract and retain tenants.

Regulatory Changes: Changes in zoning laws, environmental regulations, or tax policies could adversely affect STAG's operations. For example, stricter environmental regulations may require costly upgrades to existing properties, increasing operating expenses and reducing net operating income. STAG addresses this risk by:

• Closely monitoring regulatory developments at the local, state, and federal levels.
• Engaging with policymakers and industry groups to advocate for favorable regulations.
• Conducting thorough due diligence on potential acquisitions to identify and address regulatory risks.

Market Conditions: Economic downturns, rising interest rates, or changes in supply and demand for industrial space can all impact STAG's financial performance. A recession could lead to decreased demand for industrial space, resulting in lower occupancy rates and rental income. Rising interest rates could increase borrowing costs, reducing STAG's profitability and potentially impacting its ability to finance new acquisitions or developments. In response, STAG employs several strategies:

• Maintaining a strong balance sheet with a mix of debt and equity financing.
• Staggering debt maturities to reduce the impact of interest rate fluctuations.
• Focusing on markets with strong economic fundamentals and diverse tenant bases.

Recent earnings reports and filings highlight specific operational, financial, and strategic risks. Operationally, maintaining high occupancy rates and managing property expenses are ongoing challenges. Financially, managing debt levels and interest rate exposure are key concerns. Strategically, STAG must effectively allocate capital to new acquisitions and developments while navigating market uncertainties. Here is an overview of potential risks and mitigation strategies:

For further insights into STAG Industrial, Inc.'s (STAG) financial health, refer to: Breaking Down STAG Industrial, Inc. (STAG) Financial Health: Key Insights for Investors

STAG Industrial, Inc. (STAG) Growth Opportunities

STAG Industrial, Inc. (STAG) is poised for future growth driven by several key factors. These include strategic market expansions, a focus on acquiring high-quality industrial properties, and the increasing demand for e-commerce related warehouse and distribution spaces.

Here's an analysis of the key growth drivers:

• E-commerce Growth: The continued expansion of e-commerce is fueling demand for warehouse and distribution facilities, which are STAG's specialty.
• Strategic Acquisitions: STAG focuses on single-tenant industrial properties, which often provide higher yields and longer lease terms.
• Market Expansion: STAG strategically targets markets with strong economic fundamentals and growing populations.

While specific future revenue growth projections and earnings estimates are subject to market conditions and company performance, analysts generally expect STAG to maintain a steady growth trajectory. For example, STAG Industrial's most recent investor presentation highlights its strategic focus and portfolio metrics, offering insights into its approach to growth. To get a better understanding of who is investing in STAG and why, check out: Exploring STAG Industrial, Inc. (STAG) Investor Profile: Who’s Buying and Why?

Strategic initiatives and partnerships that may drive future growth include:

• Sustainability Initiatives: Implementing energy-efficient technologies and sustainable building practices can attract tenants and reduce operating costs.
• Technology Adoption: Integrating advanced technologies like AI and data analytics into property management can optimize efficiency and enhance tenant satisfaction.
• Strategic Partnerships: Collaborating with logistics providers and e-commerce companies can provide a pipeline of potential acquisitions and development opportunities.

STAG's competitive advantages that position the company for growth include:

• Focus on Single-Tenant Properties: This specialization allows STAG to develop expertise in managing and leasing these types of assets.
• Diversified Portfolio: STAG's portfolio is diversified across various industries and geographic locations, which reduces risk.
• Experienced Management Team: STAG's management team has a proven track record of successfully acquiring, developing, and managing industrial properties.

Here’s a look at some key financial data points relevant to STAG's growth: