Alexander's - $ALX - Earnings Analysis: Positive signs from the recent New York Leasing activity at market leading $104 starting rents.

Business Model

Alexander’s, Inc. generates revenue primarily through leasing space at its properties to tenants, tenant services and parking garage revenues.

Revenue Sources

• Lease revenues, including fixed and variable lease payments, and reimbursement of common area maintenance expenses, real estate taxes and insurance expenses.
• Revenues from sub-metered electric, elevator, trash removal and other services provided to tenants at their request.
• Revenues from operations of parking facilities, which charge hourly or monthly fees.

Income Statement Analysis

• Revenue decreased by 11.16% in Q4 2024 compared to Q4 2023.
• Net income decreased by 24.5% in Q4 2024 compared to Q4 2023.
• Basic earnings per share decreased by 24.6% in Q4 2024 compared to Q4 2023.

Balance Sheet Analysis

• Total assets decreased by 4.44% from December 31, 2023 to December 31, 2024.
• Total liabilities decreased by 0.13% from December 31, 2023 to December 31, 2024.
• Total stockholders equity decreased by 25.5% from December 31, 2023 to December 31, 2024.

Cash Flow Analysis

• Net cash provided by operating activities decreased by 50.41% from December 31, 2023 to December 31, 2024.
• Net cash used in investing activities increased from $321.812 millions to -$13.222 millions.
• Net cash used in financing activities increased 116.4% from December 31, 2023 to December 31, 2024.
• Cash and cash equivalents and restricted cash at end of year decreased by 28.78% from December 31, 2023 to December 31, 2024.

Capital Allocation

Allocation towards property operating expenses, capital improvements, tenant improvements, debt service, leasing commissions, dividends to stockholders and development costs. Plans to fund capital expenditures from operating cash flow, existing liquidity, and/or borrowings. On February 5, 2025, the Board of Directors declared a regular quarterly dividend of $4.50 per share (an indicated annual rate of $18.00 per share).

Management Commentary

Business is good, really good and getting better.

Park Avenue is already under 7% (availability).

Our stock price increased 49% in 2024 after increasing 35% in 2023.

At Regal Park in Queens, we are moving Burlington and Marshall, the last remaining tenants at Regal One, to our adjacent Rigo two shopping center, thereby filling up Rigo two and creating a fully vacant blank canvas at Rigo one for either sale or development.

The damn Yankees can't seem to beat the Brooklyn Dodgers.

Overall Sentiment: Overall, the management's sentiment is positive, expressing enthusiasm about the business, the New York market, and particularly the Penn District. They anticipate increased rents and value creation. There is a focus on strategic asset management and development.

Recommendation

Rating: Hold

Reason for Rating: Based on the detailed analysis of the financial statements, capital allocation, and management commentary, a Hold recommendation is appropriate at this time, primarily because a strong market posistion is balanced with financial performance declines.

Disclaimer: This analysis is based on company filings and public information. It is for informational purposes only and not financial advice. Past performance does not guarantee future results.

Generated on: 2/12/2025, 1:28:20 AM