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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Hudson Pacific Properties, Inc. (XNYS:HPP) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
HPP
Name:
HUDSON PACIFIC PROPERTIES, INC. (XNYS:HPP)
Sector:
91.80M
Industry:
REIT�Office
CEO:
Mr. Victor Coleman
Total Employees:
560
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -69.37% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF HUDSON PACIFIC PROPERTIES, INC.(HPP) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND REIT�OFFICE INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
13.1
One Month Price Target:
$13.17
Six Month Price Target :
$13.54
Likely Price in One Year's Time:
Ticker:
$13.97
Likely Trading Range Today Under (Normal Volatility)
$13.02
Price Upper limit ($) :
$13.15
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$12.31
This week:
$11.33
This month :
$9.56
Other Primary facts
Market Cap:
1.86B
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
141.66M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
19.63%
-23.53%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$16.78
$15.14
$9.42
$11.06
Medium risk (<10%) entry points
Buy Call
Sell Call
$14.60
Buy Put:
Sell Put:
$14.25
$11.59
$11.95
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
HPP
Sharpe Ratio:
-3.97%
Comparison:
HPP, is amongst the top 40% stocks with lowest risk-adjusted returns
Sharpe ratio is 71.97% higher than the industry
& is -274.24% lower than the market/S&P 500 average
Average Returns/Yield of
HPP
Daily returns:
-0.11%
Weekly returns:
-0.53%
Monthly returns:
-2.12%
Yearly returns:
-13.59%
Comparison of returns:
Average annual returns/yield (last 3 years) is 87.06% above industry average
Classification:
HPP, is amongst the top 40% lowest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.04
Statistical test of Returns:
HPP has yielded a lower return than the market, the results are statistically significant
Volatility (measured by Standard Deviation)
Daily Volatility:
2.89%
Weekly Volatility:
6.46%
Monthly Volatility:
12.92%
Yearly Volatility:
44.77%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.67%
Volatility in last five trading days has been -42.31% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.04%
Weekly VaR:
-13.51%
Monthly VaR:
-27.01%
How Much Can the price of
HPP
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-25%
Worst case (decline):
-93.58%
This translates to price declining to:
$9.81
This translates to price declining to:
$0.84
Severe Crash Probability
Risk of crash in next 6/12 months: Low (<25%)
What is Value at Risk (VaR)?
Risk Fundamentals
HPP is a 90.66% riskier investment compared to the market/S&P 500 & is 63.34% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 4.77% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
HPP
Beta in relation to market/S&P 500--0.99
Expected beta in 1 year's time:
0.91
Expected beta in 3 year's time:
1.286
Unlevered (debt free) Beta:
-
Beta in relation to Nasdaq (XNAS):
0.853
Beta in relation to all global stocks::
0.995
Beta Comparison & Analysis
Beta of competitors/peers::
1.021
Beta is -3.22% lower than peers
Average Industry Beta:
0.988
Beta is 0.00% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
2.06%
Sustainable growth rate is -10.18% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.353
Alpha is 50.32% above industry average alpha yield
Alpha is -2250% below the market average
Analysis of Cost of Capital of
HPP
Equity cost of capital:
0.099
Equity cost of capital is 0.00% below industry mean WACC
Unlevered (without debt) cost of capital:
-
Before-tax cost of debt:
36.29%
After-tax cost of debt:
28.67%
Overall debt rating:
Non-investment grade (junk/speculative grade
Weighted average cost of capital (WACC):
28.67%
WACC is 28.16% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$6.55
Revenue growth rate per share of (3Y):
0.45
Annual revenue growth rate is -939.00% below industry average
EPS:
-$0.13
Expected Annual growth rate of EPS (3Y):
-47.72%
Expected future EPS growth rate is -511.48% lower than the REIT�Office industry
Free cash flow (FCF) per share:
$1.06
Balance sheet equity growth per share: 0.93%
Equity growth rate per share is -109.87% lower than the industry
Debt per share
$0.00
EBITDA per share
$3.14
Valuation Analysis Today of
HPP
P/E Ratio:
0
P/E Ratio of Competitors/Peers:
29.28
P/E ratio is -100.00% lower than main peers & is higher than the industry
-
HPP is -263.44% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $19.10
Present value of the expected future dividends only: $10.08
P/S (Price to Sales ratio):
2
Price to sales ratio is -69.34% below the industry mean
P/B (Price to book value ratio):
0.45
Price to free cash flow: 12.32
Price to free cash flow ratio is -8.00% lower than the industry
Net income growth rate (3Y):
-89.63%
Net income growth rate is -278.14% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: -243.70%
Dividend yeild: 7.63%
Previous Dividend: $0.25
Previous adjusted dividend: $0.25
Previous Dividend: $1.00
-
-
Average dividend payment (long-term): $0.25
Average dividend increase/decrease (growth rate) % per period: 0.00%
Expected next dividend payment date: 28/09/2022
Expected next dividend record date: 19/09/2022
-
Previous dividend payment date: 30/06/2022
Previous dividend record date: 20/06/2022
-
Dividend History:
2022-06-16--$0.25
2021-12-17--$0.25
2021-06-17--$0.25
2022-03-18--$0.25
2021-09-17--$0.25
2021-03-18--$0.25
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
110.89%
Net debt to equity ratio:
5.10%
Debt to assets ratio:
51.77%
Net debt to assets ratio:
1.97%
Debt-to-asset ratio is -122.70% below industry average
Ability to repay debt:
Interest coverage ratio:
3.89
Interest coverage ratio is -202.77% less than industry average
Looking forward:
Debt growth rate:
9.17%
Annual debt growth is -298% lower than industry average debt growth rate
Debt repayment rate in last quarter: 100.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.673
Statistical significance of correlation:
HPP has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.626
Stock price is 7.57% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.626
Correlation of price movement with Nasdaq (^IXIC):
0.035
Covariance of price movement with the market:
0.059
Kurtosis
12.597
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
-0.299
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
HPP
Gross Profit Margin Ratio:
287%
Operating Profit Margin Ratio:
11.98%
Operating profit margin is -39.54% lower than the industry
Net Profit Margin Ratio:
287%
Effective Tax Rate:
-
-
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
-0.43%
Return on equity (ROE) is -109.91% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
-0.17%
Return on assets (ROA) is -106.09% lower than the industry
Financial Leverage:
2.1x
Current Ratio:
0.53
Current ratio is -127.01% below industry average
Cash Conversion Cycle (days):
10.3
Cash conversion cycle is -68.25% below industry average
The remaining useful life of property plant & equipment is: 1.1 years
Stock based compensation to net income ratio:
-35.15%
In-depth Efficiency Analysis
Revenue generated per employee:
1.7M
Each employee generates -28% less revenue than industry average revenue per employee
EBITDA generated per employee:
795.0K
Each employee generates -53% less EBITDA than industry average revenue per employee
Profit generated per employee:
- 27.1K
Each employee generates -104% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
163.9K
Each employee generates 316% more free cash flow than industry average revenue per employee
Assets/Capital per employee
883.9K
Each employee generates 316% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
HPP
HANNON ARMSTRONG SUSTAINABLE INFRASTRUCTURE CAPITAL, INC. (XNYS:HASI)
CLNY
PHYSICIANS REALTY TRUST (XNYS:DOC)
Waseco Resources Inc. (XTSX:WRI)
SAFEHOLD INC. (XNYS:SAFE)
JBG SMITH PROPERTIES (XNYS:JBGS)
NREF-PA
BROADSTONE NET LEASE, INC. (XNYS:BNL)
DIGITALBRIDGE GROUP, INC. (XNYS:DBRG)
Current Analyst Ratings
Strong buy�17%
Buy�21%
Hold�13%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
928.23M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
257.83M
670.40M
-
74.54M
74.54M
-
445.66M
520.20M
3.71M
114.44M
345.93M
445.21M
111.23M
- 15159.00K
- 2192.00K
-
- 15159.00K
Statement of Cash Flow
Date:
Period:
92.19M
Differed Income Tax :
-
Stock Based Compensation :
5.33M
Change in Working Capital :
- 618439.00K
Accounts Receivables:
- 4133.00K
Other Working Capital:
- 149117.00K
Other Non-Cash Items:
636.16M
Net Cash Provided by Operating Activities:
95.45M
Investments in PP&E:
- 3658.00K
Net Acquisitions:
-
Purchases of Investments:
- 10534.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
137.60M
-
137.60M
28.67M
-
-
166.27M
59.89M
109.44M
325.64M
-
-
-
494.97M
9.33B
9.00B
-
315.39M
-
-
-
315.39M
-
4.61B
4.61B
-
4.92B
1.45M
- 19793.00K
- 676.0K
3.51B
March 31, 2022 at 6:00:00 AM
572.71M
3.49B
8.41B
-
315.39M
177.8M
-
- 58077.00K
- 72269.00K
- 918.00K
-
-
- 36942.00K
15.58M
- 22280.00K
-
905.00K
197.78M
196.88M
95.45M
- 3658.00K
91.80M
Our Proprietary Portfolio Rating
Our Rating:
B
Price Forecast/Expected Price in Next 5 Years of
HPP
2023
2024
2025
2026
2027
$11.73
$12.51
$13.34
$14.22
$15.17