Paramount Group (PGRE) AI Stock Analysis

• Market Cap: $1.56B
• Dividend Yield: N/A
• Average Volume (3M): 3.28M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.74
• Revenue Growth: -5.29%
• EPS Growth: 54.66%
• Country: US
• Employees: 316
• Sector: Real Estate
• Sector Strength: 53
• Industry: REIT - Office
• EPS (TTM): -0.13
• Shares Outstanding: 221,897,430
• 10 Day Avg. Volume: 1,841,054
• 30 Day Avg. Volume: 3,280,770
• PEG Ratio: 0.28
• Price to Book (P/B): 0.34
• Price to Sales (P/S): 1.42
• P/FCF Ratio: 4.05
• Enterprise Value/Market Cap: 3.57
• Enterprise Value/Revenue: 7.70
• Enterprise Value/Gross Profit: 13.45
• Enterprise Value/Ebitda: 26.97
• 1Y Price Target: $6.60
• Price Target Upside: 0.92% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4

• Rating: 53 Neutral
• Price Target: $6.50 ▼(-0.61% Downside)

Paramount Group's overall stock score reflects a mix of strong leasing activity and increased guidance from the earnings call, offset by financial challenges such as negative profitability and weak technical indicators. The company's cash flow is a bright spot, but valuation concerns and market risks, particularly in San Francisco, weigh on the score.

Positive Factors

Leasing Activity

Record leasing activity indicates strong demand for Paramount's properties, enhancing revenue stability and supporting long-term growth.

Cash Flow Generation

Strong free cash flow growth reflects efficient operations and financial health, providing flexibility for future investments and debt management.

New York Market Strength

High occupancy in New York demonstrates market strength and resilience, ensuring steady income and supporting long-term asset value.

Negative Factors

Profitability Challenges

Negative profitability indicates operational inefficiencies, which can hinder reinvestment and growth, impacting long-term financial stability.

San Francisco Occupancy Decline

Occupancy decline in San Francisco poses risks to revenue and asset utilization, potentially affecting overall financial performance.

Lease Expiration Risk

Upcoming lease expirations in San Francisco could lead to revenue loss and increased vacancy, challenging future income stability.

Paramount Group Business Overview & Revenue Model

Company Description

Headquartered in New York City, Paramount Group, Inc. is a fully-integrated real estate investment trust that owns, operates, manages, acquires and redevelops high-quality, Class A office properties located in select central business district submarkets of New York City and San Francisco. Paramount is focused on maximizing the value of its portfolio by leveraging the sought-after locations of its assets and its proven property management capabilities to attract and retain high-quality tenants.

How the Company Makes Money

Paramount Group generates revenue primarily through leasing office space to a diverse tenant base, which includes both government and private sector entities. The company's revenue model is predominantly based on long-term leases, where it earns rental income from tenants. Additionally, PGRE may benefit from ancillary income sources, including property management fees and service charges. The firm also engages in property development and redevelopment, which can lead to increased asset value and rental income potential. Strategic partnerships with other real estate developers and investment firms can further enhance its earnings through joint ventures and co-investments in lucrative real estate projects.

Paramount Group Financial Statement Overview

Summary

Paramount Group's financial performance is challenged by negative profitability, as indicated by a net profit margin of -10.49% TTM and a negative return on equity of -2.51% TTM. Despite a healthy gross profit margin of 58.35% TTM and strong free cash flow growth of 60.9% TTM, the company faces issues with revenue generation and operational inefficiencies.

Income Statement

Paramount Group's income statement reflects challenges in profitability with a negative net profit margin of -10.49% TTM, indicating losses. The gross profit margin remains healthy at 58.35% TTM, but revenue growth has declined by 1.37% TTM, highlighting potential issues in revenue generation. The EBIT and EBITDA margins have also decreased, suggesting operational inefficiencies.

Balance Sheet

The balance sheet shows a moderate debt-to-equity ratio of 1.22 TTM, indicating a balanced leverage position. However, the return on equity is negative at -2.51% TTM, reflecting poor profitability. The equity ratio is stable, suggesting a solid asset base, but the negative ROE is a concern for investors.

Cash Flow

Cash flow analysis reveals a positive free cash flow growth rate of 60.9% TTM, indicating improved cash generation. The operating cash flow to net income ratio is strong at 1.18 TTM, showing good cash conversion. However, the reliance on free cash flow to cover net income is a potential risk if profitability does not improve.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	723.29M	757.45M	742.79M	740.38M	726.79M	714.24M
Gross Profit	413.93M	454.17M	198.18M	462.95M	461.35M	446.65M
EBITDA	206.47M	359.91M	27.54M	354.15M	381.12M	356.85M
Net Income	-97.40M	-46.29M	-259.74M	-28.20M	2.06M	-14.12M
Balance Sheet
Total Assets	7.97B	7.87B	8.01B	8.45B	8.49B	8.55B
Cash, Cash Equivalents and Short-Term Investments	330.21M	375.06M	428.21M	408.90M	524.90M	434.53M
Total Debt	0.00	3.68B	3.80B	3.84B	3.84B	3.80B
Total Liabilities	3.90B	3.86B	3.99B	4.04B	4.04B	4.04B
Stockholders Equity	4.08B	3.14B	3.20B	3.59B	3.59B	3.65B
Cash Flow
Free Cash Flow	165.44M	264.93M	277.86M	120.83M	132.31M	237.01M
Operating Cash Flow	165.44M	264.93M	277.86M	246.64M	244.31M	237.27M
Investing Cash Flow	-104.35M	-109.11M	-113.09M	-152.58M	-103.48M	40.03M
Financing Cash Flow	106.25M	-109.97M	-57.98M	-173.90M	-76.48M	-143.47M

Paramount Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 6.54
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PGRE, the sentiment is Positive. The current price of 6.54 is above the 20-day moving average (MA) of 6.53, below the 50-day MA of 6.75, and above the 200-day MA of 5.63, indicating a neutral trend. The MACD of -0.04 indicates Negative momentum. The RSI at 44.60 is Neutral, neither overbought nor oversold. The STOCH value of 55.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PGRE.

Paramount Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	―	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
DEA	―	$996.86M	71.26	1.00%	9.94%	11.02%	-30.91%
PGRE	―	$1.56B	―	-3.14%	―	-5.29%	54.66%
PDM	―	$1.00B	-14.24	-4.45%	6.20%	-1.23%	9.10%
HPP	―	$937.19M	-0.87	-12.35%	―	-9.68%	-69.03%
BDN	―	$597.56M	-3.20	-19.17%	15.45%	-5.52%	40.27%
JBGS	―	$1.42B	―	-10.10%	3.24%	-11.04%	-58.49%

Paramount Group Corporate Events

Paramount Group’s Financial Stability at Risk Amid Potential Legal Challenges from Mergers

Paramount Group may face significant business risks due to potential securities class action and derivative lawsuits, which are common for public companies involved in mergers. These legal challenges, even if baseless, could incur substantial costs and divert management’s attention, impacting the company’s financial health. An unfavorable ruling might lead to monetary damages, adversely affecting liquidity and financial stability. Furthermore, successful legal actions could delay or prevent the completion of proposed mergers, negatively influencing Paramount Group’s business operations and financial outcomes.

Paramount Group Reports Q3 2025 Earnings Amid Merger Plans

Paramount Group, Inc. is a real estate investment trust based in New York City, specializing in owning, operating, and managing high-quality office properties in central business districts of New York City and San Francisco. In its third-quarter 2025 earnings report, Paramount Group announced a net loss of $28.9 million, or $0.13 per share, which includes costs related to a proposed merger with Rithm Capital Corp. The company also reported a decrease in Core Funds from Operations (Core FFO) to $31.5 million, or $0.14 per share, compared to the previous year. Despite these challenges, Paramount successfully leased over 1.2 million square feet of space through September 2025, with a notable increase in same-store leased occupancy. The company also completed a significant refinancing of 1301 Avenue of the Americas, securing a $900 million loan. Looking ahead, Paramount Group is focused on the pending merger with Rithm Capital, which is expected to close in the fourth quarter of 2025, subject to customary conditions and stockholder approval.

Paramount Group to be Acquired by Rithm Capital

On September 17, 2025, Paramount Group, Inc. announced a definitive agreement to be acquired by Rithm Capital Corp. for approximately $1.6 billion. This acquisition will provide Rithm with a Class A office portfolio in premier markets, expanding its commercial real estate footprint and asset management capabilities. The transaction, approved by the boards of both companies, will see Rithm acquire all outstanding shares of Paramount common stock for $6.60 per share. The merger is expected to close in late Q4 2025, subject to customary conditions including stockholder approval. This strategic move is anticipated to enhance Rithm’s position in the commercial real estate market and provide new opportunities for investors.

The most recent analyst rating on (PGRE) stock is a Sell with a $4.20 price target. To see the full list of analyst forecasts on Paramount Group stock, see the PGRE Stock Forecast page.

Paramount Group’s Earnings Call Highlights Positive Outlook

The recent earnings call for Paramount Group reflected a generally positive outlook, showcasing several key achievements. The company exceeded core FFO expectations, demonstrated strong leasing activity, and maintained a balanced market performance. Paramount Group also highlighted its financial stability and adaptability to market conditions, particularly in San Francisco, where positive trends are emerging. However, challenges remain in managing lease expirations in San Francisco and upcoming lease rolls in New York.

Paramount Group Reports Q2 2025 Earnings and Guidance

Paramount Group, Inc. is a real estate investment trust headquartered in New York City, specializing in owning, operating, and managing Class A office properties in prime locations within New York City and San Francisco. The company leverages its strategic property locations and management expertise to attract high-quality tenants.