One-glance verdict
Overvalued
$-8.98 our estimate vs market $10.08
Wall Street consensus: $10.75 (-219.7% lower than our fair-value estimate)
212% below our estimate, beyond the bull case
Fundamentals snapshot
Piedmont Realty Trust, Inc.
PDM · NYQ · Real Estate · REIT - Office
Current price
$10.08
52-week range
$6.32 - $10.23
Market cap
$1.25B
Balance sheet
Distressed
0.62x Concerning
Net debt $2.33B. Interest coverage shows how many times profit covers the interest bill.
What stands out
2 Rewards
3 Risks
2 rewards · 3 risks
- Reward Revenue grew 2.9% last year.
- Reward Free cash flow was positive in 2/10 years.
- Risk Net debt grew 11.1% over 3 years.
- Risk Return on equity was -5.9% last year — the company lost money on shareholders' equity.
What this company does
Piedmont Realty Trust, Inc.
Piedmont Realty Trust owns and manages large office buildings, mostly in sunny parts of the U.S., and their main goal is to make these buildings really nice places for companies to work. They make money by renting out space in these buildings, and it matters because it means they have a steady stream of income (this steady income is a type of recurring revenue) from their tenants, which helps them pay bills and hopefully make profits.
How the company got here
Piedmont Realty Trust, Inc. was founded in 1997 and began as a non-traded real estate investment vehicle. It later evolved and was renamed Piedmont Office Realty Trust, eventually listing on the New York Stock Exchange in 2010. The company has since reshaped its portfolio, focusing on higher-quality office assets, particularly in the U.S. Sunbelt markets. This strategic shift involved assembling a portfolio of office properties and then refining it over time through property-level acquisitions and dispositions, rather than large-scale mergers. Piedmont's business model is centered on owning and operating Class A office properties, with a strong emphasis on tenant service and creating desirable workplaces.
What it actually does
Piedmont Realty Trust is a real estate investment trust (REIT) that owns, manages, develops, and operates office buildings. Think of them as a landlord for businesses, providing the physical space where companies conduct their operations. Their focus is on Class A office properties, which are generally newer, high-quality buildings in prime locations. Piedmont aims to create what they call "Piedmont PLACEs," which are designed to be more than just office space, but rather environments that enhance the workplace experience through amenities and a hospitality-driven approach to service.
Office Space Leasing
This is Piedmont's primary business. They lease out office spaces within their portfolio of buildings to various companies and government tenants. Revenue is generated through contractual office rents, which are the regular payments tenants make for using the space. Additionally, they receive income from tenant reimbursements for certain operating expenses, parking fees, and other property-related services. The company's success in this segment relies on attracting and retaining tenants by offering high-quality, well-located, and amenity-rich workplaces, especially in high-demand Sunbelt markets.
What management is betting on now
Piedmont's current strategy is focused on optimizing its real estate portfolio by selling off properties that are not considered core or do not have strong growth potential. The capital generated from these sales is then reinvested into higher-growth properties located in key Sunbelt markets like Atlanta, Dallas, and Northern Virginia. Management is also prioritizing leasing efforts, with a strong emphasis on retaining existing tenants who are increasingly seeking to renew their leases early. This strategy aims to improve the overall quality and strategic positioning of their portfolio while maintaining financial flexibility in a dynamic market.
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
$151.24M
Net income
$-21.02M
Diluted EPS
-0.17
Operating cash flow
$24.42M
Free cash flow
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Sources
Revenue
$144.12M
Net income
$-11.10M
Diluted EPS
-0.09
Operating cash flow
$64.35M
Free cash flow
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Sources
Revenue
$143.29M
Net income
$-12.92M
Diluted EPS
-0.10
Operating cash flow
$28.11M
Free cash flow
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Sources
Revenue
$142.85M
Net income
$-43.25M
Diluted EPS
-0.34
Operating cash flow
$50.94M
Free cash flow
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Sources
Revenue
$139.16M
Net income
$-13.46M
Diluted EPS
-0.11
Operating cash flow
$35.81M
Free cash flow
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Sources
Revenue
$140.29M
Net income
$-16.81M
Diluted EPS
-0.14
Operating cash flow
$50.10M
Free cash flow
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Sources
Revenue
$142.69M
Net income
$-10.10M
Diluted EPS
-0.08
Operating cash flow
$3.71M
Free cash flow
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Sources
Revenue
$143.23M
Net income
$-29.98M
Diluted EPS
-0.25
Operating cash flow
$65.04M
Free cash flow
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Sources
Is it cheap or expensive?
Fair value $-8.98 vs current price $10.08
Wall Street consensus is the average analyst price target: $10.75 (-219.7% lower than our fair-value estimate).
Our most-likely fair value is $-8.98 a share — about 189.1% below today's price of $10.08, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Distressed
Net debt $2.3B. Interest coverage 0.6x.
Net debt
$2.33B
Interest coverage
0.62x
Piedmont Realty Trust, Inc.'s profit covers its interest bill about 0.6 times over. which is stronger than most peers shown here 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
PDM
BASELINE
Piedmont Realty Trust, Inc.
Total debt $2.34B Interest coverage 0.62x This is the baseline the peer rows are being compared against.
Total debt $3.51B Interest coverage 1.37x +121% vs PDM Carries about 2.2x more debt cushion than PDM.
Total debt $2.43B Interest coverage 0.58x -7% vs PDM Has roughly the same debt cushion as PDM.
Total debt $444.60M Interest coverage -0.07x -100% vs PDM This peer has almost no interest-payment cushion compared with PDM.
What you should know
The case for and against PDM
2 Rewards
3 Risks
Rewards
-
Revenue grew 2.9% last year.
-
Free cash flow was positive in 2/10 years.
Risks
-
Net debt grew 11.1% over 3 years.
-
Return on equity was -5.9% last year — the company lost money on shareholders' equity.
-
Insider ownership is only 1.3% (peer median: 4.6%).
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
-33.60x
P/B
0.86x
P/S
2.15x
EV/EBITDA
12.87x
PEG ratio
16.74x
Profitability
How much profit each dollar creates
Gross margin
60.1%
Operating margin
14.5%
Net margin
-15.2%
ROE
-5.9%
ROA
1.2%
Health
Liquidity and balance-sheet strength
Debt / equity
1.62x
Current ratio
1.65x
Quick ratio
1.39x
Total debt
$2.34B
Total cash
$6.46M
Growth
How the business has been compounding
Revenue TTM
$581.51M
Revenue 5Y CAGR
1.7%
EPS TTM
-0.71
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$167.81M
Free CF TTM
$-16.68M
FCF margin
-2.9%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
167.8%
Last ex-div date
2025-02-21