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Boston Properties (BXP)
NYSE:BXP
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Boston Properties
(NYSE:BXP)
65Neutral
Positive Factors
Leasing Activity
Leasing activity was strong with the best quarter in five years, surpassing the full-year leasing target.
Valuation
Boston Properties offers an attractive valuation, trading at a favorable multiple compared to its adjusted funds from operations.
Negative Factors
Guidance
Weaker-than-expected guidance for 2025 overshadowed the strong leasing performance in 2024.
Interest Expenses
The 2025 FFO guidance is notably below consensus, likely driven by higher interest expenses.
Boston Properties (BXP) vs. S&P 500 (SPY)
Market Cap
$11.81B
Dividend Yield5.77%
Average Volume (3M)1.61M
Price to Earnings (P/E)732.7
Beta (1Y)1.17
Revenue Growth3.74%
EPS Growth-102.51%
CountryUS
Employees816
SectorReal Estate
Sector Strength65
IndustryREIT - Office
Share Statistics
EPS (TTM)0.39
Shares Outstanding158,324,600
10 Day Avg. Volume1,217,731
30 Day Avg. Volume1,614,097
Financial Highlights & Ratios
PEG Ratio19.09
Price to Book (P/B)1.91
Price to Sales (P/S)0.00
P/FCF Ratio10.85
Enterprise Value/Market Cap2.22
Enterprise Value/Revenue1.93
Enterprise Value/Gross Profit15.97
Enterprise Value/Ebitda3.39
Forecast
1Y Price Target
$77.55Price Target Upside14.72% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering13
Boston Properties Business Overview & Revenue Model
Company DescriptionBoston Properties (NYSE:BXP) is the largest publicly-held developer and owner of Class A office properties in the United States, concentrated in five markets - Boston, Los Angeles, New York, San Francisco and Washington, DC. The Company is a fully integrated real estate company, organized as a real estate investment trust (REIT), that develops, manages, operates, acquires and owns a diverse portfolio of primarily Class A office space. The Company's portfolio totals 51.2 million square feet and 196 properties, including six properties under construction/redevelopment.
How the Company Makes MoneyBoston Properties generates revenue primarily through leasing office space to a diverse range of tenants, including large corporations, government agencies, and other entities seeking high-quality office environments in prime urban locations. The company benefits from long-term lease agreements, which provide a stable and predictable income stream. In addition to rental income, BXP may also earn revenue from property management fees and parking facilities associated with its properties. The firm regularly engages in strategic development and redevelopment projects to enhance its portfolio and increase asset value. Additionally, BXP may form joint ventures or partnerships to share costs and risks associated with large-scale developments, further contributing to its financial performance.
Boston Properties Financial Statement Overview
Summary
Boston Properties shows strong operational efficiency with healthy gross and EBIT margins, but faces profitability challenges due to a negative net profit margin and high debt levels. Cash flow remains robust, yet the decrease in free cash flow and negative net income are concerns.Income Statement
The income statement shows mixed results. The gross profit margin for TTM (Trailing-Twelve-Months) is approximately 47.8%, which is a healthy level of profitability. However, the net profit margin is negative at -0.1%, indicating challenges in converting revenue to profit. Revenue growth has been modest, with a 0.8% increase from the previous year. EBIT and EBITDA margins are strong at 36.4% and 53.2% respectively, demonstrating operational efficiency, but the negative net income presents a concern.65
Positive
Balance Sheet
The balance sheet highlights some areas of concern. The debt-to-equity ratio is high at approximately 3.09, indicating significant leverage which could pose risks if market conditions change. The return on equity is negative at -0.08%, reflecting the negative net income. The equity ratio stands at 20.9%, suggesting a decent proportion of equity financing, but the overall high level of debt is a notable risk factor.55
Neutral
Cash Flow
Cash flow analysis shows a strong operational cash flow to net income ratio of approximately -234.0, indicating robust cash generation despite negative net income. The free cash flow has decreased by about 24.0% compared to the previous year. The free cash flow to net income ratio is negative, but the company maintains positive free cash flow, which is essential for ongoing operations and investments.70
Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 3.43B | 3.41B | 3.27B | 3.11B | 2.89B | 2.77B | Gross Profit |
| 1.64B | 2.08B | 2.05B | 1.96B | 1.84B | 1.72B | EBIT |
| 1.25B | 1.02B | 1.85B | 1.02B | 976.21M | 827.70M | EBITDA |
| 1.83B | 1.91B | 1.87B | 1.77B | 1.69B | 2.14B | Net Income Common Stockholders |
| -4.43M | 14.27M | 190.22M | 583.45M | 84.41M | 525.74M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 766.63M | 1.25B | 1.53B | 690.33M | 452.69M | 1.67B | Total Assets |
| 25.53B | 26.08B | 26.03B | 24.21B | 22.36B | 22.86B | Total Debt |
| 16.16B | 16.98B | 16.62B | 14.69B | 13.35B | 13.49B | Net Debt |
| 15.39B | 15.73B | 15.09B | 14.00B | 12.89B | 11.82B | Total Liabilities |
| 17.24B | 18.14B | 17.83B | 15.84B | 14.31B | 14.51B | Stockholders Equity |
| 5.87B | 5.41B | 5.88B | 6.13B | 5.83B | 6.00B |
| Cash Flow | Free Cash Flow | ||||
| 937.10M | 1.23B | 1.30B | 884.31M | 1.12B | 1.15B | Operating Cash Flow |
| 1.04B | 1.23B | 1.30B | 1.28B | 1.13B | 1.16B | Investing Cash Flow |
| -883.30M | -1.24B | -1.19B | -1.60B | -1.04B | -613.72M | Financing Cash Flow |
| 414.95M | -274.48M | 767.92M | 556.06M | -1.31B | 484.32M |
Boston Properties Technical Analysis
Positive
67.60
Price Trends
64.92
Positive
67.66
Positive
71.89
Negative
Market Momentum
0.70
Negative
61.42
Neutral
97.18
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BXP, the sentiment is Positive. The current price of 67.6 is above the 20-day moving average (MA) of 65.38, above the 50-day MA of 64.92, and below the 200-day MA of 71.89, indicating a neutral trend. The MACD of 0.70 indicates Negative momentum. The RSI at 61.42 is Neutral, neither overbought nor oversold. The STOCH value of 97.18 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BXP.
Boston Properties Risk Analysis
Boston Properties disclosed 48 risk factors in its most recent earnings report. Boston Properties reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Boston Properties Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $7.80B | 19.64 | 3.69% | 6.55% | 1.11% | -3.07% | |
66 Neutral | $12.81B | 97.22 | 0.73% | 7.08% | 5.13% | -28.94% | |
66 Neutral | $4.71B | 85.60 | 1.15% | 4.47% | 10.93% | -31.07% | |
66 Neutral | $8.18B | 76.08 | 3.06% | 1.87% | 0.63% | 258.59% | |
65 Neutral | $11.81B | 732.74 | -0.10% | 5.77% | 3.74% | -102.51% | |
60 Neutral | $2.82B | 10.29 | 0.31% | 8508.26% | 5.91% | -17.42% | |
58 Neutral | $4.44B | 663.10 | -0.13% | 5.18% | 13.36% | 94.82% |
* Real Estate Sector Average
Performance Comparison
BXP
Boston Properties
67.60
8.66
14.69%
ARE
Alexandria Equities
72.18
-45.34
-38.58%
CUZ
Cousins Properties
27.60
4.92
21.69%
KRC
Kilroy Realty
32.75
0.66
2.06%
SLG
SL Green Realty
58.28
7.82
15.50%
VNO
Vornado Realty
38.82
14.64
60.55%
Boston Properties Earnings Call Summary
Earnings Call Date:Apr 29, 2025
(Q1-2025)
| % Change Since: 3.81%|
Next Earnings Date:Jul 29, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a strong performance in leasing and financing activities, and leadership in sustainability. However, the company faces challenges from federal policies, tariffs, and potential recession impacts. The Premier Workplace segment remains strong, but there are concerns in the life science sector and a decline in office sales volume.Q1-2025 Updates
Positive Updates
Strong Leasing Activity
BXP completed over 1.1 million square feet of leasing in Q1 2025, 25% above Q1 2024 and 35% above the 5-year seasonal average. The leasing volume over the last four quarters was 33% higher than the previous four quarters.
Significant Financing Achievements
BXP completed over $4.2 billion of financing activity, demonstrating strong access to capital and improving market conditions. They increased their revolving line of credit by $250 million and extended their $700 million term loan.
Sustainability Leadership
BXP released its 2024 sustainability and impact report, highlighting leadership and accomplishments in sustainable business practices.
Development Pipeline Progress
BXP commenced the development of the 290 Kohl's, a 670-unit market rate multifamily project. The project is expected to deliver initial units in the first half of 2028 and stabilize in the second half of 2029.
Positive Office Market Performance
The Premier Workplace segment, where BXP competes, continues to outperform with a direct vacancy of just over 13% compared to 19% for the broader market. Asking rents for Premier Workplaces are more than 50% higher than the broader market.
Negative Updates
Impact of Federal Policies and Tariffs
Federal tariffs have increased volatility in capital markets, with potential for higher prices, inflation, and interest rates. This has reduced consumer confidence and increased the likelihood of a recession or slower GDP growth.
Life Science Sector Challenges
Federal funding cuts to NIH and research organizations, along with uncertainties over FDA approvals, create significant concerns and headwinds for Life Science leasing.
Decline in Office Sales Volume
Office sales volume in Q1 2025 was $7.6 billion, down approximately 14% from Q1 2024, impacted by market volatility and widened credit spreads.
Potential Impacts of Recession
If the U.S. enters a recession, leasing demand could slow, although interest rates might be lower, and remote work could decrease.
Occupancy Decline and Redevelopment Challenges
Occupancy reduced to 86.9% due to expirations, with additional potential redevelopments requiring tenant relocations and entitlement processes extending closing periods.
Company Guidance
During BXP's Q1 2025 earnings call, several key metrics were highlighted, reflecting the company's robust performance and strategic initiatives. BXP reported a Funds From Operations (FFO) per share that aligned with forecasts, achieving a leasing volume of over 1.1 million square feet, which marks a 25% increase from the same quarter in 2024 and a 33% increase over the past four quarters. The company completed $4.2 billion in financing activities, indicating strong market conditions and capital access. BXP's development pipeline also saw notable progress, with significant leases completed for assets like 1050 Winter Street, which is now 100% pre-leased. Additionally, the company's Premier Workplace segment outperformed the broader office market, with direct vacancy rates just over 13% compared to 19% for the broader market. The company's capital allocation activities included the commencement of a 670-unit multifamily project in Jersey City, targeting a yield on cost of over 6%, with anticipated returns in the mid-teens. Despite market volatility, BXP maintained a stable dividend and projected occupancy, revenue, and FFO growth in the upcoming years, supported by a pipeline of 4 million square feet in active negotiations.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.