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Douglas Emmett (DEI)
:DEI
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Douglas Emmett
(NYSE:DEI)
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Rating:54Neutral
Price Target:
$16.00
▲(3.36% Upside)
Douglas Emmett's overall stock score reflects a combination of moderate financial performance, neutral technical indicators, and valuation concerns. The earnings call provided mixed signals, with strong leasing activity and residential success offset by financial strains and high redevelopment costs. The high P/E ratio suggests potential overvaluation, while the dividend yield offers some compensation for investors.
Positive Factors
Strong Leasing Activity
The company's ability to lease significant office space indicates strong demand and effective property management, supporting long-term revenue stability.
Residential Portfolio Success
Full occupancy and rising rents in the residential portfolio suggest robust demand and effective pricing strategy, enhancing revenue potential.
Office to Residential Conversion
Converting office space to residential units can reduce vacancy rates and diversify revenue streams, aligning with urban living trends.
Negative Factors
High Leverage
Significant leverage can increase financial risk, limiting flexibility and potentially impacting the company's ability to invest in growth opportunities.
Declining Cash Flow
Decreasing cash flow growth indicates potential liquidity challenges, affecting the company's ability to fund operations and capital expenditures.
Rising Redevelopment Costs
Increasing redevelopment costs can strain financial resources and delay project completion, impacting profitability and cash flow.
Douglas Emmett (DEI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.14B
Dividend Yield4.91%
Average Volume (3M)1.51M
Price to Earnings (P/E)71.5
Beta (1Y)0.99
Revenue Growth-0.57%
EPS GrowthN/A
CountryUS
Employees770
SectorReal Estate
Sector Strength53
IndustryREIT - Office
Share Statistics
EPS (TTM)-0.04
Shares Outstanding167,446,350
10 Day Avg. Volume1,548,275
30 Day Avg. Volume1,511,396
Financial Highlights & Ratios
PEG Ratio-0.88
Price to Book (P/B)1.51
Price to Sales (P/S)3.15
P/FCF Ratio18.35
Enterprise Value/Market Cap2.95
Enterprise Value/Revenue9.27
Enterprise Value/Gross Profit17.44
Enterprise Value/Ebitda14.28
Forecast
1Y Price Target
$17.25Price Target Upside11.43% Upside
Rating ConsensusHold
Number of Analyst Covering8
Douglas Emmett Business Overview & Revenue Model
Company DescriptionDouglas Emmett, Inc. (DEI) is a fully integrated, self-administered and self-managed real estate investment trust (REIT), and one of the largest owners and operators of high-quality office and multifamily properties located in the premier coastal submarkets of Los Angeles and Honolulu. Douglas Emmett focuses on owning and acquiring a substantial share of top-tier office properties and premier multifamily communities in neighborhoods that possess significant supply constraints, high-end executive housing and key lifestyle amenities.
How the Company Makes MoneyDouglas Emmett generates revenue primarily through leasing its office and multifamily properties to tenants. The company earns rental income from long-term leases with corporate clients and residential tenants, which constitutes a significant portion of its revenue stream. Additionally, DEI benefits from property management services, as it manages its portfolio of assets to optimize occupancy rates and rental income. The company may also realize gains through the sale of properties, particularly those that appreciate in value over time or reach operational maturity. Partnerships with local businesses and community organizations can enhance tenant retention and drive demand for its properties, further contributing to its financial performance.
Douglas Emmett Earnings Call Summary
Earnings Call Date:Aug 05, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 04, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mix of achievements in leasing activity and residential portfolio success alongside challenges such as decreased FFO and rising redevelopment costs. Despite strong leasing and strategic conversions, financial metrics show certain strains.Q2-2025 Updates
Positive Updates
Strong Leasing Activity
Douglas Emmett leased 973,000 square feet of office space, including over 300,000 square feet of new leases, achieving positive absorption for 3 of the last 4 quarters.
Residential Portfolio Success
The multifamily portfolio had full occupancy, increasing rents, and same-property cash NOI growth exceeding 10%.
Office to Residential Conversion
Plans to convert the 10900 Wilshire office property into 320 apartments in Westwood, aiming to enhance value and reduce office vacancy.
Refinancing Progress
Refinanced a $200 million office loan with a new nonrecourse interest-only loan at competitive rates, maturing in August 2032.
Negative Updates
Decreased FFO and AFFO
Funds from operations (FFO) decreased to $0.37 per share, and adjusted funds from operations (AFFO) decreased to $54.5 million.
Same-Property Cash NOI Decline
Same-property cash NOI was down 1.1% due to a prior year's large property tax refund, creating a tough comparison.
Cash Re-Leasing Spreads Declined
Cash spreads decreased by 13.3% during the quarter.
Brentwood Redevelopment Costs
The redevelopment costs for The Landmark Residences in Brentwood are expected to rise to approximately $400 million.
Company Guidance
During the call, Douglas Emmett provided guidance for 2025, projecting net income per common share diluted to be between $0.07 and $0.11 and narrowing the guidance range for FFO per fully diluted share to be between $1.43 and $1.47. The company reported that revenue increased by 2.7% compared to the second quarter of 2024, while FFO decreased to $0.37 per share and AFFO decreased to $54.5 million. Same-property cash NOI was down 1.1% due to a tough comparison from a large property tax refund in the prior year. Excluding property tax refunds, same-property cash NOI would have been slightly positive. Additionally, the company's residential portfolio remained essentially fully leased at 99.3%, and they highlighted strong demand and increasing rents, with same-property cash NOI growth exceeding 10%.Douglas Emmett Financial Statement Overview
Summary
Douglas Emmett presents a solid financial profile with stable revenue and profit margins, reflecting operational efficiency. Despite high leverage, the company maintains stable equity levels. Cash flows are positive, with growth in free cash flow supporting future expansions. Continuous monitoring of debt levels is recommended to mitigate financial risks.Income Statement
Douglas Emmett shows a stable gross profit margin with minor fluctuations, indicating strong cost control. The net profit margin has improved over the last year due to increasing net income, signaling enhanced profitability. Revenue growth has been positive, although the pace has varied. EBIT and EBITDA margins are stable, reflecting consistent operating efficiency.65
Positive
Balance Sheet
The debt-to-equity ratio is relatively high, suggesting significant leverage, which might pose financial risks if not managed properly. However, the equity ratio remains stable, indicating a reasonable proportion of equity financing. Return on equity has improved, reflecting better profit generation from shareholder investments.55
Neutral
Cash Flow
Free cash flow has shown growth, supporting potential reinvestment opportunities. The operating cash flow to net income ratio is strong, indicating good conversion of income into cash. However, the free cash flow to net income ratio fluctuates due to variations in net income, suggesting potential volatility in cash conversion.60
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 999.70M | 986.48M | 1.02B | 993.65M | 918.40M | 891.52M |
| Gross Profit | 531.50M | 636.22M | 198.91M | 659.83M | 615.00M | 586.11M |
| EBITDA | 649.21M | 590.86M | 593.58M | 619.52M | 574.92M | 566.67M |
| Net Income | 37.70M | 23.52M | -42.71M | -53.65M | -84.70M | -106.22M |
Balance Sheet | ||||||
| Total Assets | 9.43B | 9.40B | 9.64B | 9.75B | 9.35B | 9.25B |
| Cash, Cash Equivalents and Short-Term Investments | 426.89M | 444.62M | 523.08M | 268.84M | 335.90M | 172.38M |
| Total Debt | 5.58B | 5.51B | 5.55B | 5.20B | 5.02B | 4.76B |
| Total Liabilities | 5.84B | 5.75B | 5.80B | 5.47B | 5.37B | 5.25B |
| Stockholders Equity | 2.00B | 2.06B | 2.22B | 2.56B | 2.42B | 2.44B |
Cash Flow | ||||||
| Free Cash Flow | 126.92M | 169.30M | 237.81M | 258.77M | 153.86M | 122.62M |
| Operating Cash Flow | 391.73M | 408.69M | 426.96M | 496.89M | 446.95M | 420.22M |
| Investing Cash Flow | -235.71M | -240.76M | -233.59M | -560.95M | -288.71M | -265.18M |
| Financing Cash Flow | -290.27M | -246.46M | 60.87M | -3.00M | 5.25M | -136.33M |
Douglas Emmett Technical Analysis
Negative
15.48
Price Trends
15.42
Positive
15.08
Positive
15.44
Positive
Market Momentum
-0.03
Positive
46.08
Neutral
30.40
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DEI, the sentiment is Negative. The current price of 15.48 is below the 20-day moving average (MA) of 15.91, above the 50-day MA of 15.42, and above the 200-day MA of 15.44, indicating a neutral trend. The MACD of -0.03 indicates Positive momentum. The RSI at 46.08 is Neutral, neither overbought nor oversold. The STOCH value of 30.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DEI.
Douglas Emmett Risk Analysis
Douglas Emmett disclosed 50 risk factors in its most recent earnings report. Douglas Emmett 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
Douglas Emmett Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $4.83B | 77.95 | 1.30% | 4.45% | 13.07% | -4.94% | |
69 Neutral | $5.07B | 23.04 | 4.06% | 5.09% | 2.26% | 10.15% | |
68 Neutral | $3.51B | 27.70 | 5.39% | 6.17% | -2.16% | -16.41% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
60 Neutral | $4.50B | 663.10 | -0.37% | 5.18% | 15.25% | 79.18% | |
54 Neutral | $3.14B | 71.53 | 1.74% | 4.91% | -0.57% | ― | |
53 Neutral | $1.04B | ― | -12.35% | 2.07% | -9.68% | -69.03% |
* Real Estate Sector Average
DEI
Douglas Emmett
15.48
-1.28
-7.64%
CUZ
Cousins Properties
28.78
1.36
4.96%
HIW
Highwoods Properties
32.44
2.03
6.68%
HPP
Hudson Pacific Properties
2.72
-1.86
-40.61%
KRC
Kilroy Realty
42.45
6.82
19.14%
SLG
SL Green Realty
59.33
-4.43
-6.95%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.