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Morguard Real Estate (TSE:MRT.UN)
:MRT.UN
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Morguard Real Estate ate
(TSX:MRT.UN)
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Select Model
Rating:51Neutral
Price Target:
C$6.00
▲(4.35% Upside)
The overall stock score reflects significant financial challenges, with declining revenues and high leverage being the most impactful factors. While technical indicators show moderate positive momentum, the negative P/E ratio and mixed earnings call sentiment contribute to a cautious outlook.
Morguard Real Estate ate (MRT.UN) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$376.69M
Dividend Yield4.3%
Average Volume (3M)6.49K
Price to Earnings (P/E)―
Beta (1Y)0.39
Revenue Growth-2.90%
EPS Growth68.88%
CountryCA
Employees8
SectorReal Estate
Sector Strength53
IndustryREIT - Diversified
Share Statistics
EPS (TTM)-0.03
Shares Outstanding65,511,360
10 Day Avg. Volume4,725
30 Day Avg. Volume6,493
Financial Highlights & Ratios
PEG Ratio0.29
Price to Book (P/B)0.40
Price to Sales (P/S)1.37
P/FCF Ratio29.32
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$5.50Price Target Upside-4.35% Downside
Rating ConsensusHold
Number of Analyst Covering1
Morguard Real Estate ate Business Overview & Revenue Model
Company DescriptionMorguard Real Estate Investment Trust (MRT.UN) is a Canada-based real estate investment trust focused on owning, managing, and developing retail, office, and industrial properties across Canada. The company's portfolio includes a diverse range of properties strategically located in prime markets, catering to various tenants and industries. Morguard REIT is committed to providing high-quality spaces that meet the needs of its tenants while delivering stable and sustainable returns to its investors.
How the Company Makes MoneyMorguard Real Estate Investment Trust generates revenue primarily through leasing its properties to tenants in the retail, office, and industrial sectors. The company earns rental income, which forms the bulk of its revenue, through long-term lease agreements with tenants. Additionally, MRT.UN enhances its revenue by managing property-related services and maintenance, which may include property management fees. The trust may also realize gains from the strategic sale of properties and reinvest in its portfolio to optimize its asset base. The company's earnings are further supported by its focus on maintaining high occupancy rates and effective cost management strategies.
Morguard Real Estate ate Earnings Call Summary
Earnings Call Date:Jul 30, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Oct 22, 2025
Earnings Call Sentiment Negative
The call highlighted some positive developments, such as strong occupancy rates in certain segments and successful mortgage renewals. However, significant challenges were noted, including a decrease in net operating income, increased vacancies, and impacts from tenant issues like the Bay's creditor protection. While there are positive elements, the negative aspects are substantial, leading to a cautiously pessimistic outlook.Q2-2025 Updates
Positive Updates
Strong Occupancy in Challenging Market
Despite a tough market, Penn West Plaza achieved an 80% occupancy rate after transitioning from a single tenant to a multi-tenant building.
Decline in Interest Expense
The trust's interest expense declined by $1.3 million for the quarter due to lower short-term variable interest rates, with a total decrease of over $2 million for the six-month period.
Successful Lease Renewals and Extensions
The Trust renewed or extended four mortgages totaling $80 million, lowering the interest rate from an average of 6.4% to 5%.
High Occupancy in Strip Centers
With the exception of one location, community strip centers are nearly full at 99% occupancy.
Negative Updates
Decrease in Total Net Operating Income
Total net operating income declined from $31.8 million in 2024 to $25.7 million in 2025, primarily due to the Penn West Plaza lease reset.
Increased Vacancy and Occupancy Decline
Overall occupancy level decreased to 85.9% at June 30, 2025, down from 91.2% at December 31, 2024, due to increased vacancy at Penn West Plaza and the disclaimed Bay lease at Cambridge.
Impact of Bay's Creditor Protection
The Bay filed for creditor protection, affecting two locations and leading to a disclaimed lease at Cambridge, impacting the Trust's annualized gross rent.
Fair Value Losses
The Trust faced $11 million in fair value losses due to minor changes across all asset classes in the portfolio.
Company Guidance
During the Morguard North American Residential REIT 2025 Second Quarter Results Conference Call, CFO Andrew Tamlin highlighted several key metrics and trends. The total net operating income (NOI) for the second quarter saw a decline from $31.8 million in 2024 to $25.7 million in 2025, primarily due to the lease reset at Penn West Plaza, accounting for $4.7 million of this $6 million drop. Occupancy at Penn West Plaza stood at 80% following the expiration of the Obsidian head lease. The Trust's overall occupancy level decreased to 85.9% from 91.2% at the end of 2024. Interest expense declined by $1.3 million for the quarter due to lower short-term variable interest rates, while liquidity was slightly down at $72 million compared to $81 million at the end of 2024. The Trust renewed or extended four mortgages totaling $80 million, reducing the average interest rate from 6.4% to 5%. Despite challenges, there was positive sentiment for retail assets, with strip centers nearly full at 99% occupancy. The Trust's focus remains on maintaining strong fundamentals in retail and office leasing environments, anticipating a bounce-back in 2026 after addressing current challenges.Morguard Real Estate ate Financial Statement Overview
Summary
Morguard Real Estate faces significant financial challenges, with declining revenues and persistent profitability issues. The high leverage on the balance sheet increases financial risk, while weak cash flow performance limits operational flexibility.Income Statement
The income statement shows a declining revenue trend with a negative revenue growth rate of -2.25% in the TTM period. The company has been struggling with profitability, as indicated by negative net profit margins across all periods, with the TTM net profit margin at -13.31%. While the gross profit margin remains relatively stable, the EBIT and EBITDA margins are low, reflecting operational challenges.45
Neutral
Balance Sheet
The balance sheet reveals a high debt-to-equity ratio of 1.44 in the TTM period, indicating significant leverage. The return on equity is negative, suggesting that the company is not generating sufficient returns on its equity base. The equity ratio is moderate, showing a balanced asset structure, but the high leverage poses potential risks.50
Neutral
Cash Flow
The cash flow statement indicates a decline in free cash flow growth, with a significant drop of -25.49% in the TTM period. The operating cash flow to net income ratio is low, reflecting challenges in converting income into cash. The free cash flow to net income ratio is moderate, but overall cash flow performance is weak, impacting liquidity.40
Negative
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 249.38M | 259.17M | 255.08M | 242.63M | 241.44M | 253.76M |
| Gross Profit | 116.92M | 128.23M | 125.97M | 121.99M | 122.13M | 123.78M |
| EBITDA | 29.64M | 6.09M | 123.90M | -34.05M | 117.27M | -302.67M |
| Net Income | -33.19M | -58.82M | -74.44M | -138.06M | -47.38M | -410.70M |
Balance Sheet | ||||||
| Total Assets | 2.18B | 2.17B | 2.28B | 2.38B | 2.49B | 2.56B |
| Cash, Cash Equivalents and Short-Term Investments | 6.51M | 7.90M | 7.28M | 9.71M | 11.27M | 8.65M |
| Total Debt | 1.25B | 1.23B | 1.26B | 1.27B | 1.30B | 1.35B |
| Total Liabilities | 1.31B | 1.29B | 1.32B | 1.33B | 1.34B | 1.40B |
| Stockholders Equity | 867.71M | 884.23M | 961.18M | 1.05B | 1.15B | 1.16B |
Cash Flow | ||||||
| Free Cash Flow | 14.82M | 12.12M | 27.28M | 41.55M | 63.14M | 15.10M |
| Operating Cash Flow | 43.19M | 54.46M | 66.32M | 73.97M | 80.19M | 46.92M |
| Investing Cash Flow | -38.58M | -5.28M | -39.04M | -32.42M | -2.95M | -25.02M |
| Financing Cash Flow | -5.30M | -48.55M | -29.71M | -43.11M | -74.62M | -19.04M |
Morguard Real Estate ate Technical Analysis
Positive
5.75
Price Trends
5.72
Positive
5.71
Positive
5.56
Positive
Market Momentum
<0.01
Positive
50.37
Neutral
9.52
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:MRT.UN, the sentiment is Positive. The current price of 5.75 is below the 20-day moving average (MA) of 5.76, above the 50-day MA of 5.72, and above the 200-day MA of 5.56, indicating a neutral trend. The MACD of <0.01 indicates Positive momentum. The RSI at 50.37 is Neutral, neither overbought nor oversold. The STOCH value of 9.52 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:MRT.UN.
Morguard Real Estate ate Peers Comparison
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | 113.70M | 4.81 | 5.49% | 6.27% | -0.21% | 0.00% | |
79 Outperform | 223.77M | 9.34 | 11.06% | 8.84% | 3.24% | 3.36% | |
79 Outperform | 393.13M | 13.96 | 5.16% | 7.68% | -0.28% | 206.65% | |
76 Outperform | 332.77M | 8.77 | 7.69% | 8.21% | 1.59% | 19.74% | |
51 Neutral | C$376.69M | ― | -3.72% | 4.30% | -2.90% | 68.88% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% |
* Real Estate Sector Average
Performance Comparison
TSE:MRT.UN
Morguard Real Estate ate
5.75
0.36
6.68%
TSE:BTB.UN
BTB REIT
3.77
0.51
15.64%
TSE:FCD.UN
Firm Capital Property
6.06
0.82
15.65%
TSE:NET.UN
Canadian Net Real Estate Investment Trust Trust Units
5.52
0.40
7.81%
TSE:PRV.UN
PRO Real Estate Investment
5.86
0.64
12.26%
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.