One-glance verdict
Within fair range
$30.31 our estimate vs market $41.13
Wall Street consensus: $43.23 (42.7% higher than our fair-value estimate)
36% above our estimate
Fundamentals snapshot
Phillips Edison & Company, Inc.
PECO · NMS · Real Estate · REIT - Retail
Current price
$41.13
52-week range
$34.22 - $44.38
Market cap
$5.82B
Balance sheet
Stretched
1.93x Concerning
Net debt $2.51B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
3 Risks
3 rewards · 3 risks
- Reward Revenue grew 4.8% last year.
- Reward Returns 7.6% on equity, ahead of 16% of its peers.
- Risk Forward P/E (52.9x) is higher than trailing (28.8x) - earnings are expected to drop.
- Risk Net debt grew 24.1% over 3 years.
What this company does
Phillips Edison & Company, Inc.
Phillips Edison & Company (PECO) owns and runs neighborhood shopping centers, mostly those with a big grocery store as the main tenant. They make money from rent paid by all the shops inside these centers, which is important because it shows how well these essential shopping spots are doing. This business model means they focus on keeping their shopping centers full of popular stores that people need every day.
How the company got here
Phillips Edison & Company, Inc. (PECO) was founded in 1991 by former real estate professionals who saw an opportunity in community and neighborhood shopping centers. They began by investing in properties across the U.S. through private funds. A significant turning point came in 2010 when the company launched its first non-traded real estate investment trust (REIT), followed by another in 2013. In 2015, PECO separated its strategic investment and net lease business to focus solely on its grocery-anchored shopping center portfolio. The company then consolidated its affiliated vehicles before becoming a publicly traded company in 2021. PECO's strategy has always been to focus exclusively on owning and operating grocery-anchored shopping centers, which are seen as essential retail destinations.
What it actually does
PECO is a real estate investment trust (REIT) that owns, operates, and manages shopping centers across the United States. Think of it like owning a collection of strip malls or neighborhood shopping plazas. The company's main business is to acquire or develop these centers, sign leases with various retailers, and collect rent from them. This rental income is the primary way PECO makes money. They focus on centers that are anchored by grocery stores, as these tend to attract consistent customer traffic, benefiting all the other businesses in the center.
Grocery-Anchored Shopping Centers
This is the core business of Phillips Edison & Company. They own and operate shopping centers where a grocery store is the main attraction, or 'anchor.' These centers also house a variety of other retailers and service providers, such as restaurants, pharmacies, and beauty salons, which cater to the everyday needs of the local community. The grocery stores, like Kroger or Publix, bring in shoppers regularly, which helps the smaller businesses in the same center stay busy and pay their rent. PECO's revenue from these centers comes primarily from the rent paid by these tenants.
Third-Party Investment Management
In addition to owning its own shopping centers, PECO also offers property management and advisory services to other entities. This includes managing shopping centers for three institutional joint ventures and one private fund, where PECO has a partial ownership stake. Essentially, PECO uses its expertise in managing grocery-anchored centers to help these other investment groups, and in return, it earns fees for these services. This segment represents a smaller portion of PECO's overall revenue compared to its owned properties.
What management is betting on now
PECO's management is focused on continuing to grow and enhance the value of its portfolio of grocery-anchored shopping centers. Their strategy centers on acquiring and operating these types of properties because they are considered essential retail, meaning people need to shop there regardless of economic conditions. They are also focused on creating 'omni-channel' experiences, which means their grocery-anchored centers cater to shoppers who buy in-store, online for pickup, or for delivery. This adaptability aims to ensure the long-term success and relevance of their shopping centers in a changing retail landscape.
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
$193.09M
Net income
$62.68M
Diluted EPS
0.49
Operating cash flow
$85.47M
Free cash flow
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Sources
Revenue
$189.62M
Net income
$41.12M
Diluted EPS
0.33
Operating cash flow
$118.03M
Free cash flow
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Sources
Revenue
$190.74M
Net income
$30.38M
Diluted EPS
0.24
Operating cash flow
$55.56M
Free cash flow
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Sources
Revenue
$187.86M
Net income
$47.52M
Diluted EPS
0.38
Operating cash flow
$96.06M
Free cash flow
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Sources
Revenue
$182.67M
Net income
$24.68M
Diluted EPS
0.20
Operating cash flow
$95.42M
Free cash flow
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Sources
Revenue
$177.75M
Net income
$12.78M
Diluted EPS
0.10
Operating cash flow
$96.12M
Free cash flow
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Sources
Revenue
$178.31M
Net income
$26.31M
Diluted EPS
0.21
Operating cash flow
$60.54M
Free cash flow
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Sources
Revenue
$173.05M
Net income
$18.14M
Diluted EPS
0.16
Operating cash flow
$84.00M
Free cash flow
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Is it cheap or expensive?
Fair value $30.31 vs current price $41.13
Wall Street consensus is the average analyst price target: $43.23 (42.7% higher than our fair-value estimate).
Our most-likely fair value is $30.31 a share — about 26.3% away from today's price of $41.13, so the stock currently looks fairly priced.
Is it drowning in debt?
Stretched
Net debt $2.5B. Interest coverage 1.9x.
Net debt
$2.51B
Interest coverage
1.93x
Phillips Edison & Company, Inc.'s profit covers its interest bill about 1.9 times over. which is stronger than most peers shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Stretched
Worse cushion
Baseline
Better cushion
PECO
BASELINE
Phillips Edison & Company, Inc.
Total debt $2.52B Interest coverage 1.93x This is the baseline the peer rows are being compared against.
Total debt $2.84B Interest coverage 1.47x -24% vs PECO Carries about 1.3x less debt cushion than PECO.
Total debt $4.97B Interest coverage 2.50x +30% vs PECO Carries about 1.3x more debt cushion than PECO.
Total debt $5.13B Interest coverage 2.82x +47% vs PECO Carries about 1.5x more debt cushion than PECO.
Total debt $8.59B Interest coverage 2.17x +13% vs PECO Has roughly the same debt cushion as PECO.
Total debt $0.00 Interest coverage -0.10x -100% vs PECO This peer has almost no interest-payment cushion compared with PECO.
What you should know
The case for and against PECO
3 Rewards
3 Risks
Rewards
-
Revenue grew 4.8% last year.
-
Returns 7.6% on equity, ahead of 16% of its peers.
-
Free cash flow was positive in 4/10 years.
Risks
-
Forward P/E (52.9x) is higher than trailing (28.8x) - earnings are expected to drop.
-
Net debt grew 24.1% over 3 years.
-
Insider ownership is only 0.6% (peer median: 0.8%).
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)
28.76x
Forward P/E
52.89x
P/B
2.20x
P/S
7.64x
EV/EBITDA
17.19x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
71.1%
Operating margin
29.5%
Net margin
23.9%
ROE
7.6%
ROA
2.6%
Health
Liquidity and balance-sheet strength
Debt / equity
0.93x
Current ratio
2.10x
Quick ratio
0.94x
Total debt
$2.52B
Total cash
$8.90M
Growth
How the business has been compounding
Revenue TTM
$761.31M
Revenue 5Y CAGR
8.1%
EPS TTM
1.43
EPS 5Y CAGR
28.4%
Cash flow
How much cash the business throws off
Operating CF TTM
$355.12M
Free CF TTM
$212.00M
FCF margin
27.8%
Dividend
Shareholder payout
Yield
3.4%
Payout ratio
83.3%
Last ex-div date
2026-09-15