REXR Stock Fair Value Calculation – BMO Cuts Rating on Rexford Industrial Realty as L.A. Market Cools

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BMO recently downgraded Rexford Industrial Realty ($NYSE:REXR) to Market Perform, citing the cooler Los Angeles market as a potential risk for the company. Rexford Industrial Realty is an industrial real estate investment trust that acquires, owns, and operates industrial properties in Southern California. It focuses on local markets in Los Angeles County, Orange County, San Diego County, and Ventura.

However, BMO was concerned that the cooling Los Angeles market could cause Rexford Industrial Realty to struggle if their occupancy rates were to drop. BMO analysts hope that the company can continue to maintain their strong leasing activity and occupancy rates despite the cooling of the Los Angeles market. With their extensive portfolio in the Southern California area, Rexford Industrial Realty is still well-positioned to capitalize on the logistics and distribution market.

Price History

On Tuesday, shares of REXFORD INDUSTRIAL REALTY opened at $50.7 and closed at $52.8, rising 3.5% from the prior closing price of $51.0. The rise in stock price occurred despite Bank of Montreal (BMO) cutting its rating for Rexford to “market perform” from its previous “outperform” rating, citing a cooling industrial market in Los Angeles. Specifically, BMO analysts flagged the increasing risk of occupancy losses in the city due to heightened competition from new supply and a weak outlook for sales and leasing activity. Live Quote…

About the Company

Income Snapshot

Below shows the total revenue, net income and net margin for REXR. More…

Cash Flow Snapshot

Below shows the cash from operations, investing and financing for REXR. More…

Balance Sheet Snapshot

Below shows the total assets, liabilities and book value per share for REXR. More…

Key Ratios Snapshot

Some of the financial key ratios for REXR are shown below. More…

Analysis – REXR Stock Fair Value Calculation

At GoodWhale, we recently conducted extensive research into the fundamentals of REXFORD INDUSTRIAL REALTY to determine its fair value. We determined that the fair value of REXFORD INDUSTRIAL REALTY share is around $76.2, calculated by our proprietary Valuation Line. Right now, REXFORD INDUSTRIAL REALTY stock is traded at $52.8, undervalued by 30.7%. This presents an opportunity for investors looking to purchase stock at a discounted price and reap the potential rewards when prices rise to the fair value. More…

Peers

Rexford Industrial Real Estate Trust is a real estate investment trust focused on the ownership of industrial properties in the United States. The company’s competitors include FIBRA Macquarie, First Industrial Realty Trust Inc, and Orix Jreit Inc.

– FIBRA Macquarie ($OTCPK:DBMBF)

FIBRA Macquarie is a Mexican real estate investment trust (REIT) that invests in income-producing real estate, primarily industrial properties, in Mexico. As of December 31, 2020, the company’s portfolio consisted of 106 properties with a total gross leasable area of approximately 16.6 million square feet. FIBRA Macquarie is the largest industrial REIT in Mexico and is one of the largest REITs in Latin America.

– First Industrial Realty Trust Inc ($NYSE:FR)

First Industrial Realty Trust is a real estate investment trust that owns and operates industrial properties. The company has a market cap of $5.82 billion as of 2022. First Industrial Realty Trust’s portfolio consists of over 1,800 properties, totaling approximately 140 million square feet of space. The company’s properties are located in 26 states and Canada, and are leased to over 2,200 customers. First Industrial Realty Trust is headquartered in Chicago, Illinois.

– Orix Jreit Inc ($TSE:8954)

Orix Jreit Inc is a Japanese real estate investment trust that was founded in 2002. The company invests in a variety of real estate assets, including office buildings, retail properties, and warehouses. As of March 31, 2021, Orix Jreit’s portfolio consisted of 222 properties with a total value of approximately JPY 1.8 trillion. The company is headquartered in Tokyo and its shares are listed on the Tokyo Stock Exchange.

Summary

Rexford Industrial Realty is a real estate investment trust (REIT) that invests in industrial properties in the Los Angeles area. Recently, BMO Capital Markets downgraded the stock from Outperform to Market Perform due to cooling market conditions in the L.A. area. Despite this, the stock price still rose on the same day, indicating a continued strong market sentiment towards Rexford Industrial.