BRT Realty Trust Stock Downgraded (BRT)

NEW YORK ( TheStreet) -- BRT Realty (NYSE: BRT) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, solid stock price performance and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income and weak operating cash flow.

Highlights from the ratings report include:
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • BRT REALTY TRUST has exprienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past two years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, BRT REALTY TRUST turned its bottom line around by earning $0.35 versus -$0.62 in the prior year.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income has significantly decreased by 155.7% when compared to the same quarter one year ago, falling from $1.85 million to -$1.03 million.
  • Net operating cash flow has significantly decreased to -$6.85 million or 443.43% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

BRT Realty Trust operates as a real estate investment trust (REIT) in the United States. It engages in originating and holding for investment senior and junior mortgage loans secured by commercial and multi-family real estate property. The company has a P/E ratio of 14.9, above the average real estate industry P/E ratio of 12.3 and below the S&P 500 P/E ratio of 17.7. BRT has a market cap of $98.4 million and is part of the financial sector and real estate industry. Shares are up 10.4% year to date as of the close of trading on Tuesday.

You can view the full BRT Ratings Report or get investment ideas from our investment research center.

-- Written by a member of TheStreet Ratings Staff

TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
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