June 28, 2025 a 03:31 am
ARE: Dividend Analysis - Alexandria Real Estate Equities, Inc.
Alexandria Real Estate Equities, Inc. demonstrates a robust dividend profile with a remarkable history of 29 years of consistent dividend payments. Despite the high EPS payout ratio, its substantial dividend yield of 7.17% underscores its attractive income-generating capability for investors. With no history of recent cuts or suspensions, Alexandria stands as a considered choice for dividend-focused portfolios.
📊 Overview
| Metric | Value |
|---|---|
| Sector | Real Estate |
| Dividend Yield | 7.17% |
| Current Dividend per Share | 5.22 USD |
| Dividend History | 29 years |
| Last Cut or Suspension | None |
🗣️ Dividend History
The extensive 29-year history of dividend payments reflects Alexandria's strong commitment to returning value to shareholders. Such a legacy provides assurance of the company's ability to maintain and potentially grow its dividends over time.
| Year | Dividend per Share (USD) |
|---|---|
| 2025 | 2.64 |
| 2024 | 5.19 |
| 2023 | 4.96 |
| 2022 | 4.72 |
| 2021 | 4.48 |
📈 Dividend Growth
The firm's dividend growth is modest yet consistent, reflecting a balanced approach to enhancing shareholder returns while reinvesting in its core business. Dividend growth rates over 3 and 5 years are particularly important as they highlight the company's ability to increase payouts sustainably.
| Time | Growth |
|---|---|
| 3 years | 5.03% |
| 5 years | 5.35% |
The average dividend growth is 5.35% over 5 years. This shows moderate but steady dividend growth.
🔍 Payout Ratio
The payout ratios elucidate a critical aspect of dividend sustainability. Alexandria's EPS-based payout ratio exceeds 647%, indicating that dividends are significantly higher than earnings, whereas the FCF-based ratio is a more conservative 65.87%, suggesting dividends are well-covered by free cash flow.
| Key Figure | Ratio |
|---|---|
| EPS-based | 647.46% |
| Free Cash Flow-based | 65.87% |
The high EPS-based payout ratio raises concerns about dividend coverage, but the healthier FCF ratio provides some reassurance.
💰 Cashflow & Capital Efficiency
An effective analysis of cash flow and capital efficiency offers insights into Alexandria's ability to generate cash versus capital expenditure. Metrics such as free cash flow yield and earnings yield help to assess how well the company utilizes its resources.
| Year | Free Cash Flow Yield | Earnings Yield | CAPEX to Operating C.F. | Stock Comp. to Revenue | FCF/OCF Ratio | ROIC |
|---|---|---|---|---|---|---|
| 2024 | 8.96% | 1.92% | 0% | 1.91% | 100% | 2.35% |
| 2023 | 7.53% | 0.48% | 0% | 2.87% | 100% | 3.11% |
| 2022 | 5.50% | 2.22% | 0% | 2.23% | 100% | 1.64% |
Alexandria's stable free cash flow and efficient capital utilization bode well for its ongoing operations and ability to sustain dividends.
🏦 Balance Sheet & Leverage Analysis
The analysis of leverage and balance sheet strength is vital in assessing Alexandria's financial risk profile. Metrics like debt-to-equity and quick ratio reflect the company's ability to meet liabilities.
| Year | Debt-to-Equity | Debt-to-Assets | Net Debt to EBITDA | Current Ratio | Quick Ratio | Financial Leverage |
|---|---|---|---|---|---|---|
| 2024 | 0.71 | 0.34 | 6.33 | 0.40 | 0.40 | 2.10 |
| 2023 | 0.63 | 0.32 | 7.65 | 1.06 | 1.06 | 1.99 |
| 2022 | 0.54 | 0.29 | 5.73 | 0.34 | 0.34 | 1.87 |
The company's relatively high leverage ratios indicate a cautious approach to debt management, balancing between growth financing and financial health.
📌 Fundamental Strength & Profitability
Examining Alexandria's profitability indicators like return on equity and asset returns provides insights into operational efficiency and cost management.
| Year | ROE | ROA | Net Margin | EBIT Margin | EBITDA Margin | Gross Margin |
|---|---|---|---|---|---|---|
| 2024 | 1.81% | 0.86% | 10.36% | 22.35% | 61.82% | 70.82% |
| 2023 | 0.56% | 0.28% | 3.59% | 12.31% | 50.20% | 70.23% |
| 2022 | 2.75% | 1.47% | 20.15% | 29.54% | 62.93% | 69.75% |
Alexandria's profitability metrics suggest a well-managed and profitable operation, with impressive margins reflecting strong pricing power and cost control.
📉 Price Development
✅ Dividend Scoring System
| Criteria | Score | Score Bar |
|---|---|---|
| Dividend Yield | 5 | |
| Dividend Stability | 4 | |
| Dividend Growth | 3 | |
| Payout Ratio | 2 | |
| Financial Stability | 3 | |
| Dividend Continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 3 |
Total Score: 29/40
⚠️ Rating
Alexandria Real Estate Equities, Inc. is recommended as a solid dividend stock, especially appealing to income-seeking investors due to its impressive yield and dividend growth track record. However, investors should remain cognizant of its high EPS payout ratio and leverage metrics.