One-glance verdict
Within fair range
$-13.61 our estimate vs market $3.54
Wall Street consensus: $6.65 (-148.8% lower than our fair-value estimate)
126% below our estimate
Fundamentals snapshot
Creative Media & Community Trust Corporation
CMCT · NCM · Real Estate · REIT - Office
Current price
$3.54
52-week range
$1.78 - $1,441.00
Market cap
$11.39M
Balance sheet
Distressed
0.24x Concerning
Net debt $486.00M. Interest coverage shows how many times profit covers the interest bill.
What stands out
1 Reward
3 Risks
1 rewards · 3 risks
- Reward Free cash flow was positive in 1/10 years.
- Risk Net debt grew 258.0% over 3 years.
- Risk Operating margin compressed from 16.4% to -1.8% over 3 years.
- Risk Return on equity was -15.6% last year — the company lost money on shareholders' equity.
What this company does
Creative Media & Community Trust Corporation
Creative Media & Community Trust Corporation (CMCT) is like a landlord that owns buildings where people live (apartments) and businesses, especially in creative fields like tech and entertainment, can set up their offices. The money they make primarily comes from collecting rent from these tenants, which is important because rent payments are a consistent way for them to earn income. They also own a hotel, adding another source of potential earnings.
How the company got here
Creative Media & Community Trust Corporation (CMCT) was established in 1993 and is a real estate investment trust (REIT). A REIT is a company that owns, operates, or finances income-generating real estate. CMCT focuses on acquiring, developing, and managing premier multifamily (rental apartment) and creative office properties located in vibrant communities across the United States. The company leverages the expertise of CIM Group, L.P., a real estate and infrastructure owner and operator with extensive experience in acquisition, development, and property management. This partnership allows CMCT to tap into a broad range of capabilities, from research and credit analysis to leasing and on-site property management.
What it actually does
CMCT invests in and manages real estate properties, primarily focusing on two main types: multifamily residential buildings and creative office spaces. Multifamily properties are essentially apartment buildings where people rent apartments to live. Creative office spaces are designed to be flexible and appealing to businesses in growing industries like technology, media, and entertainment, often featuring modern designs and amenities. CMCT aims to own and operate these properties in dynamic and growing communities, ensuring they are well-maintained and attractive to tenants.
Multifamily Properties
CMCT owns and operates apartment buildings, which are properties where individuals or families rent living spaces. These are often referred to as 'multifamily' properties because they house multiple families or households under one roof. The company focuses on acquiring and developing these properties in attractive markets, aiming to provide quality housing in communities that are experiencing growth. This segment represents a significant portion of CMCT's real estate holdings, providing a steady stream of rental income.
Creative Office Properties
This segment involves CMCT's ownership and development of office buildings designed to attract businesses in fast-growing sectors like technology, media, and entertainment. These 'creative' office spaces are often characterized by unique architectural designs, flexible layouts, and amenities that foster collaboration and innovation. CMCT actively acquires and develops these properties in dynamic markets, positioning them to meet the evolving needs of modern businesses and contributing a substantial part of the company's overall strategy.
Hotel Property
CMCT also owns a hotel property located in Northern California. Hotels provide short-term lodging for travelers and guests, generating revenue through room rentals and other services. While this is a distinct asset within CMCT's portfolio, it represents a smaller portion of the company's overall business compared to its multifamily and office properties.
Lending Platform
In addition to its real estate holdings, CMCT operates a lending platform. This segment involves providing loans to small businesses. This diversification into lending offers another avenue for the company to generate income and potentially grow its assets, complementing its core real estate operations.
What management is betting on now
CMCT's management is focused on acquiring, developing, and operating high-quality multifamily and creative office assets in vibrant and growing communities. They are leveraging the deep expertise of CIM Group to identify and manage these properties effectively. The strategy centers on investing in real estate that caters to industries with strong growth potential, such as technology and media, while also maintaining a portfolio of desirable apartment buildings. This approach aims to create long-term value by owning properties in dynamic markets that are attractive to both residents and businesses.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
Revenue
$29.68M
Net income
$-9.90M
Diluted EPS
-4.03
Operating cash flow
$3.45M
Free cash flow
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Sources
Revenue
$29.42M
Net income
$-8.31M
Diluted EPS
-70.52
Operating cash flow
$-25.99M
Free cash flow
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Sources
Revenue
$28.45M
Net income
$-11.43M
Diluted EPS
-3.89
Operating cash flow
$3.32M
Free cash flow
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Sources
Revenue
$26.23M
Net income
$-12.46M
Diluted EPS
-23.52
Operating cash flow
$3.74M
Free cash flow
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Sources
Revenue
$29.69M
Net income
$-9.00M
Diluted EPS
-18.94
Operating cash flow
$-2.48M
Free cash flow
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Sources
Revenue
$32.30M
Net income
$-6.11M
Diluted EPS
-20.73
Operating cash flow
$1.21M
Free cash flow
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Sources
Revenue
$27.46M
Net income
$-10.27M
Diluted EPS
-15.02
Operating cash flow
$1.15M
Free cash flow
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Sources
Revenue
$28.62M
Net income
$-10.38M
Diluted EPS
-1.22
Operating cash flow
$10.34M
Free cash flow
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Sources
Is it cheap or expensive?
Fair value $-13.61 vs current price $3.54
Wall Street consensus is the average analyst price target: $6.65 (-148.8% lower than our fair-value estimate).
Our most-likely fair value is $-13.61 a share — about 484.6% away from today's price of $3.54, so the stock currently looks fairly priced.
Is it drowning in debt?
Distressed
Net debt $486.0M. Interest coverage 0.2x.
Net debt
$486.00M
Interest coverage
0.24x
Creative Media & Community Trust Corporation's profit covers its interest bill about 0.2 times over. and 2 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Distressed
Worse cushion
Baseline
Better cushion
CMCT
BASELINE
Creative Media & Community Trust Corporation
Total debt $498.77M Interest coverage 0.24x This is the baseline the peer rows are being compared against.
Total debt $254.06M Interest coverage -0.33x -100% vs CMCT This peer has almost no interest-payment cushion compared with CMCT.
Total debt $2.23B Interest coverage 1.31x +439% vs CMCT Carries about 5.4x more debt cushion than CMCT.
Total debt $16.36B Interest coverage 1.55x +540% vs CMCT Carries about 6.4x more debt cushion than CMCT.
Total debt $8.19B Interest coverage 0.81x +235% vs CMCT Carries about 3.4x more debt cushion than CMCT.
Total debt $3.78B Interest coverage 1.41x +483% vs CMCT Carries about 5.8x more debt cushion than CMCT.
What you should know
The case for and against CMCT
1 Reward
3 Risks
Rewards
-
Free cash flow was positive in 1/10 years.
Risks
-
Net debt grew 258.0% over 3 years.
-
Operating margin compressed from 16.4% to -1.8% over 3 years.
-
Return on equity was -15.6% last year — the company lost money on shareholders' equity.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
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Forward P/E
-1.47x
P/B
0.06x
P/S
0.11x
EV/EBITDA
19.99x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
35.7%
Operating margin
-1.8%
Net margin
-39.3%
ROE
-15.6%
ROA
-0.1%
Health
Liquidity and balance-sheet strength
Debt / equity
2.03x
Current ratio
0.41x
Quick ratio
0.21x
Total debt
$498.77M
Total cash
$12.77M
Growth
How the business has been compounding
Revenue TTM
$113.78M
Revenue 5Y CAGR
6.4%
EPS TTM
-2,770.30
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$-15.48M
Free CF TTM
$-15.00M
FCF margin
-13.2%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
2024-07-08