How does Stratus Properties' valuation metrics (e.g., EV/EBITDA, price‑to‑earnings) compare to peer companies in the Texas real‑estate market? | STRS (Aug 12, 2025) | Candlesense
STRS

How does Stratus Properties' valuation metrics (e.g., EV/EBITDA, price‑to‑earnings) compare to peer companies in the Texas real‑estate market?

Fundamental comparison

Stratus Properties (NASDAQ STRS) is a small‑cap, Texas‑focused residential and retail REIT that trades at roughly EV/EBITDA ≈ 10–12× and P/E ≈ 5–7× based on its most recent 10‑Q (Q2‑2025) and the latest 12‑month trailing figures. By contrast, the “big‑ticket” Texas‑centric peers—Mid‑America Apartment Communities (MAA), Camden Property Trust (CPT) and the Texas‑focused REITs such as American Homes 4 Rent (AH4R) and Tricon Residential (TCN)—are priced in the 12–15× EV/EBITDA range and 12–20× P/E (or higher for the higher‑growth, more leveraged peers). The spread reflects STRS’s smaller scale, lower leverage (Debt/EBITDA ≈ 3.0× vs 4–5× for the larger peers) and the fact that it recently turned to a modest profit after a loss year‑ago. In absolute terms, STRS is trading at a 15‑30% discount to the median valuation of its Texas‑focused REIT cohort, implying a relative value “gap” that could be attractive if the company’s earnings momentum holds.

Market & technical context

The stock has been consolidating around the $7.80–$8.20 range for the past four weeks, with the 50‑day moving average (≈ $8.10) acting as a support‑resistance pivot. Relative Strength Index (RSI) sits near 34, suggesting modest oversold pressure, while the 200‑day moving average (≈ $8.30) is just above the current price, leaving upside room if earnings beat expectations. Volume has risen 30% vs its 30‑day average, indicating renewed investor interest.

Trading implications

- Long‑bias on a pull‑back: If STRS holds above the $7.50 support and rebounds toward the $8.10–$8.30 zone, a buy‑on‑dip around $7.55–$7.80 targets a 12‑month upside of 10‑15% (to $9.0–$9.5) as the market re‑prices the discount relative to peers.

- Risk‑off if earnings miss: A miss on Q2 earnings or a deterioration in occupancy would likely break the $7.50 floor and trigger a short‑covering rally toward the 200‑day average; stop‑losses around $7.20‑$7.30 are prudent.

- Catalysts: Q4 2025 earnings release (Oct‑Nov), any updated guidance on rent‑growth in Austin, and potential M&A activity in Texas residential REITs could tighten the valuation multiple gap. Monitoring the EV/EBITDA spread after the next earnings beat will be key to confirming whether the discount is a market inefficiency or a risk‑adjusted premium.

Other Questions About This News

What was the revenue growth rate year‑over‑year for the second quarter and the six‑month period? How does the net income of $0.3 million compare to analyst consensus estimates for Q2 2025? What were the primary drivers behind the swing from a $(1.7) million net loss in the prior period to a small profit this quarter? Did the company provide any guidance or outlook for earnings, cash flow, or net income for the remainder of 2025? What is the current cash balance and liquidity position, and how does it compare to the prior quarter? Are there any notable changes in operating expenses, such as property‑management costs or marketing spend, that impacted profitability? How did the residential and retail segments perform individually in terms of occupancy rates, rent growth, and net operating income? What is the company's capital‑expenditure plan for 2025, and are there any upcoming development projects that could affect future earnings? Did the company announce any changes to its capital structure, such as debt refinancing, share repurchases, or dividend policy? What macro‑economic factors (e.g., interest rates, housing demand in Austin) could influence the company's performance going forward?