Stock of the Day

December 17, 2020

Alexandria Real Estate Equities (ARE)

$95.06
-$2.33 (-2.4%)
Market Cap: $16.60B

About Alexandria Real Estate Equities

Alexandria Real Estate Equities, Inc. (NYSE: ARE), an S&P 500 company, is a best-in-class, mission-driven life science REIT making a positive and lasting impact on the world. As the pioneer of the life science real estate niche since our founding in 1994, Alexandria is the preeminent and longest-tenured owner, operator, and developer of collaborative life science, agtech, and advanced technology mega campuses in AAA innovation cluster locations, including Greater Boston, the San Francisco Bay Area, New York City, San Diego, Seattle, Maryland, and Research Triangle. Alexandria has a total market capitalization of $33.1 billion and an asset base in North America of 73.5 million SF as of December 31, 2023, which includes 42.0 million RSF of operating properties, 5.5 million RSF of Class A/A+ properties undergoing construction and one near-term project expected to commence construction in the next two years, 2.1 million RSF of priority anticipated development and redevelopment projects, and 23.9 million SF of future development projects. Alexandria has a longstanding and proven track record of developing Class A/A+ properties clustered in life science, agtech, and advanced technology mega campuses that provide our innovative tenants with highly dynamic and collaborative environments that enhance their ability to successfully recruit and retain world-class talent and inspire productivity, efficiency, creativity, and success. Alexandria also provides strategic capital to transformative life science, agrifoodtech, climate innovation, and technology companies through our venture capital platform. We believe our unique business model and diligent underwriting ensure a high-quality and diverse tenant base that results in higher occupancy levels, longer lease terms, higher rental income, higher returns, and greater long-term asset value.

Alexandria Real Estate Equities Bull Case

Here are some ways that investors could benefit from investing in Alexandria Real Estate Equities, Inc.:

  • The stock recently traded at $98.91, which is near its 52-week low of $97.14, potentially indicating a buying opportunity for investors looking for value.
  • Despite a recent earnings miss, the company reported a revenue increase of 10.9% year-over-year, suggesting strong operational performance and growth potential.
  • Alexandria Real Estate Equities, Inc. has a market capitalization of approximately $17.38 billion, indicating a stable and established presence in the real estate investment trust (REIT) sector.
  • Research analysts have a consensus rating of "Hold" with an average target price of $124.82, suggesting that there is potential for price appreciation from current levels.
  • The company has a relatively low debt-to-equity ratio of 0.56, indicating a manageable level of debt compared to its equity, which can be a positive sign for financial stability.

Alexandria Real Estate Equities Bear Case

Investors should be bearish about investing in Alexandria Real Estate Equities, Inc. for these reasons:

  • The stock has been downgraded by multiple analysts, with price targets being lowered, which may indicate a lack of confidence in the company's near-term performance.
  • Recent earnings results showed a significant miss on EPS, reporting $0.96 compared to the consensus estimate of $2.38, raising concerns about profitability.
  • The current ratio and quick ratio are both at 0.20, suggesting potential liquidity issues, as these ratios indicate the company's ability to cover short-term liabilities with its short-term assets.
  • The P/E ratio of 60.63 is relatively high, which may suggest that the stock is overvalued compared to its earnings, making it a riskier investment.
  • With a beta of 1.15, the stock is more volatile than the market, which could lead to larger price swings and increased risk for investors.

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