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Granite Real Estate
(TSX:GRT.UN)
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Rating:75Outperform
Price Target:
C$104.00
â–²(15.94% Upside)
Action:Reiterated
Date:08/10/26
The score is driven primarily by strong underlying financial performance (profitability, improving TTM growth, solid cash flow) and a constructive earnings update with tightened guidance and improving leverage. Valuation is also supportive with a reasonable P/E and solid yield. These positives are tempered by weaker near-term technical momentum (oversold signals and price below key short-term averages) and ongoing sensitivity to financing/valuation conditions typical for a leveraged REIT.
Positive Factors
Same-Property NOI & Leasing Momentum
Sustained same-property NOI growth and strong leasing spreads demonstrate durable pricing power and demand in industrial/logistics assets. Higher occupancy and sizable rent re-leasing spreads support long-run net operating income, underpinning stable FFO generation and cash flow predictability across cycles.
Negative Factors
Refinancing Timing Risk
A near-term material maturity concentrates refinancing exposure into late 2026. Even with strong liquidity, the trust may face higher funding costs or shorter-term facilities if market rates or credit spreads move, which would increase interest expense and pressure FFO/AFFO unless hedged or proactively extended.
Read all positive and negative factors
Positive Factors
Negative Factors
Same-Property NOI & Leasing Momentum
Sustained same-property NOI growth and strong leasing spreads demonstrate durable pricing power and demand in industrial/logistics assets. Higher occupancy and sizable rent re-leasing spreads support long-run net operating income, underpinning stable FFO generation and cash flow predictability across cycles.
Read all positive factors
Granite Real Estate (GRT.UN) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$5.24B
Dividend Yield4.15%
Average Volume (3M)92.62K
Price to Earnings (P/E)14.2
Beta (1Y)0.85
Revenue Growth8.73%
EPS Growth11.84%
CountryCA
Employees70
SectorReal Estate
Sector Strength53
IndustryREIT - Industrial
Share Statistics
EPS (TTM)6.00
Shares Outstanding62,083,990
10 Day Avg. Volume112,922
30 Day Avg. Volume92,623
Financial Highlights & Ratios
PEG Ratio-6.96
Price to Book (P/B)0.91
Price to Sales (P/S)8.07
P/FCF Ratio12.88
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$106.50Price Target Upside18.73% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)6.27
Revenue Forecast (FY)C$666.58M
Granite Real Estate Business Overview & Revenue Model
Company Description
Granite Real Estate Investment Trust is a Canada-based REIT primarily focused on acquiring, developing, managing, and owning industrial, logistics, and warehouse properties. Its operations extend across both North America and Europe, with its port...
How the Company Makes Money
Granite Real Estate makes money primarily by earning rental income from leasing its properties to tenants. The largest revenue stream is base rent collected under lease contracts (often with contractual rent escalators and pass-through provisions ...
Granite Real Estate Earnings Call Summary
Earnings Call Date:Aug 05, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 04, 2026
Earnings Call Sentiment Positive
The call conveyed clear operational momentum: strong same-property NOI growth, meaningful FFO growth year-over-year, tightened guidance, improved leverage metrics and abundant liquidity to fund an active pipeline of acquisitions and dispositions. Challenges were largely manageable or one-time in nature — notably an HST provision, elevated G&A this quarter due to noncash compensation adjustments and some fair value losses/market softness in select geographies (GTA, New Jersey). Given the balance of persistent leasing strength, disciplined capital recycling, improved balance sheet metrics and accretive acquisition activity versus the contained and specific negative items, the positives materially outweigh the negatives.Positive Updates
Strong Same-Property NOI Growth
Same-property NOI increased 8.3% on a constant currency basis and 9.1% including foreign exchange, driven by strong leasing spreads (7%), lease-up of completed U.S. development vacancies and a 220 basis point improvement in occupancy year-over-year. Management narrowed full-year same-property NOI outlook to a 4-quarter average of 6.0%–6.5% (constant currency).
Negative Updates
Nonrecurring HST Provision and One-Time Items
Recognized a $2.6 million provision related to a 5-year HST audit at a subsidiary (impacting G&A ~$1.7M and interest ~$0.9M) partially offset by $1.3M termination/closeout lease revenue, resulting in a net nonrecurring negative impact of ~$1.3M (about $0.02 per unit to FFO/AFFO). Management has filed an objection with the CRA but recognized the provision prudently.
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Q2-2026 Updates
Positive
Negative
Strong Same-Property NOI Growth
Same-property NOI increased 8.3% on a constant currency basis and 9.1% including foreign exchange, driven by strong leasing spreads (7%), lease-up of completed U.S. development vacancies and a 220 basis point improvement in occupancy year-over-year. Management narrowed full-year same-property NOI outlook to a 4-quarter average of 6.0%–6.5% (constant currency).
Read all positive updates
Company Guidance
Granite tightened and updated its 2026 guidance: FFO/unit $6.30–$6.40 (≈7–8% growth y/y) and AFFO/unit $5.45–$5.55 (≈4–6% growth), with AFFO-related capex forecast at ≈$40M for the year (Q2 AFFO capex $14.7M; $34M in 2025). Management narrowed its 4‑quarter average constant‑currency same‑property NOI growth outlook to 6.0–6.5% (Q2 same‑property NOI +8.3% cc / +9.1% incl. FX; occupancy +220 bps y/y) and updated H2 USD/GBP FX assumptions; the outlook assumes disposition of ~$66M of assets held for sale and $195M of new acquisitions to close by early Q4 (financed by dispositions, draws and cash) and no further ATM issuances. Key balance‑sheet and operating assumptions include investment properties $9.6B, liquidity $1.2B (cash ~$165M + ~ $997M undrawn line), 1.4M units issued YTD under ATM for ~$138.4M gross, net leverage 32% (33% in Q1), debt/EBITDA 6.6x (6.8x Q1), weighted‑avg cost of debt 2.62%, weighted‑avg debt term 2.9 years, expected interest expense ≈$23.5M/Q, G&A impacting FFO/AFFO ≈$11.5M/Q (~7% of revenues), and current income tax ~$3.2–$3.3M/Q.Granite Real Estate Financial Statement Overview
Summary
Income Statement
82
Very Positive
Balance Sheet
74
Positive
Cash Flow
79
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 645.70M | 618.70M | 569.14M | 521.25M | 455.58M | 393.49M |
| Gross Profit | 528.99M | 507.07M | 471.99M | 435.24M | 380.36M | 332.68M |
| EBITDA | 488.42M | 459.39M | 480.48M | 203.14M | 346.73M | 293.51M |
| Net Income | 364.76M | 342.34M | 360.61M | 136.66M | 155.77M | 1.31B |
Balance Sheet | ||||||
| Total Assets | 9.79B | 9.73B | 9.62B | 9.07B | 9.28B | 8.57B |
| Cash, Cash Equivalents and Short-Term Investments | 94.59M | 139.59M | 126.17M | 116.13M | 135.08M | 402.51M |
| Total Debt | 3.05B | 3.34B | 3.11B | 3.10B | 3.07B | 2.46B |
| Total Liabilities | 4.01B | 4.22B | 3.88B | 3.78B | 3.80B | 3.25B |
| Stockholders Equity | 5.78B | 5.51B | 5.73B | 5.28B | 5.48B | 5.32B |
Cash Flow | ||||||
| Free Cash Flow | 380.92M | 387.55M | 338.48M | 312.90M | 276.69M | 261.68M |
| Operating Cash Flow | 381.14M | 387.67M | 338.61M | 313.18M | 277.50M | 262.26M |
| Investing Cash Flow | -61.95M | -203.58M | -65.46M | -128.13M | -766.56M | -1.03B |
| Financing Cash Flow | -305.93M | -166.28M | -267.50M | -203.11M | 214.56M | 333.48M |
Granite Real Estate Technical Analysis
Neutral
89.70
Price Trends
89.06
Negative
91.61
Negative
88.15
Negative
Market Momentum
-1.34
Negative
45.59
Neutral
75.80
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:GRT.UN, the sentiment is Neutral. The current price of 89.7 is above the 20-day moving average (MA) of 84.82, above the 50-day MA of 89.06, and above the 200-day MA of 88.15, indicating a neutral trend. The MACD of -1.34 indicates Negative momentum. The RSI at 45.59 is Neutral, neither overbought nor oversold. The STOCH value of 75.80 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:GRT.UN.
Granite Real Estate Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | C$5.24B | 14.16 | 6.51% | 4.15% | 8.73% | 11.84% | |
73 Outperform | C$4.09B | 7.34 | 12.79% | 5.66% | 4.77% | 24.61% | |
70 Outperform | C$4.84B | 4.69 | 22.27% | 3.98% | 0.07% | 295.34% | |
66 Neutral | C$4.55B | 28.72 | 3.03% | 6.93% | -1.11% | -31.75% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
65 Neutral | C$3.59B | 21.98 | 3.53% | 5.51% | 7.63% | -22.77% | |
62 Neutral | C$3.01B | -51.02 | 6.03% | 5.67% | 3.98% | -1411.59% |
* Real Estate Sector Average
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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.