Last Updated: 14 Sep 2024
Executive Summary
Paramount Group Inc. (PGRE), a real estate investment trust (REIT) specializing in Class A office properties in New York City and San Francisco, exhibits a challenging financial position. Despite solid revenue growth, the company faces significant losses and negative profitability margins. Analysts hold a neutral outlook on the stock, with a target price of $4.7.
Company Overview
Paramount Group Inc. is a fully integrated REIT that acquires, develops, and manages office properties in the United States. The company's portfolio consists of 12 properties totaling approximately 5.3 million square feet. Paramount Group is headquartered in New York City.
Fundamental Analysis
Revenue: Paramount Group's revenue has grown steadily in recent years, reaching $519.1 million in the trailing twelve months (TTM). However, the company's operating expenses have outpaced revenue growth, resulting in losses.
Earnings: The company reported a net loss of $98 million in the TTM, with a diluted EPS of -$0.98. Profitability margins are negative, with a profit margin of -0.408% and an operating margin of 0.182%.
Valuation: Paramount Group's market capitalization is approximately $1.2 billion. The stock is trading at a price-to-sales ratio (P/S) of 2.311 and a price-to-book ratio (P/B) of 0.345.
Technical Analysis
Price Action: The stock price has been trending sideways in recent months, currently trading around $5.05. The 50-day moving average is $4.953, and the 200-day moving average is $4.807.
Support and Resistance: Key support levels are at $4.7 and $4.5, while resistance levels are at $5.3 and $5.7.
Short Term Outlook
Analysts expect Paramount Group's financial performance to remain weak in the short term. The company faces challenges in controlling expenses and improving profitability. The stock price is likely to remain range-bound until the company shows signs of improvement.
Long Term Outlook
The long-term outlook for Paramount Group is uncertain. The company's portfolio of high-quality properties in desirable locations could provide long-term value. However, the company needs to address its profitability issues to unlock this potential.
Analyst Recommendations
Analysts have a neutral outlook on Paramount Group. One analyst recommends a "Buy" rating, while four analysts recommend a "Hold" rating. Two analysts recommend a "Sell" rating. The consensus analyst target price is $4.7, representing a potential downside of 5.7%.
