Investment Thesis
First Industrial Realty Trust demonstrates solid revenue growth (8.6% YoY) and strong free cash flow generation (45.6% FCF margin), but faces critical debt servicing concerns with interest coverage of only 1.0x, indicating operating income barely covers interest expenses. Declining EPS (-13.8% YoY) and flat net income growth despite revenue expansion signal operational stress, while minimal cash reserves relative to $2.6B debt load limit financial flexibility.
Strengths
- Strong free cash flow generation at $88.9M with 45.6% FCF margin, providing operational cash returns to stakeholders
- Positive revenue growth of 8.6% YoY indicating continued market demand and business expansion
- Moderate debt-to-equity ratio of 0.94x shows reasonable leverage levels on balance sheet
Risks
- Critical interest coverage ratio of 1.0x signals operating income barely covers interest obligations, leaving zero margin for error and potential covenant violation risk
- Declining diluted EPS (-13.8% YoY) and minimal net income growth (0.1% YoY) despite revenue gains indicate deteriorating profitability per share
- Extremely low liquidity position with only $37.1M cash against $2.6B long-term debt, constraining operational flexibility and refinancing options
Key Metrics to Watch
- Interest coverage ratio trend - critical threshold is maintaining above 1.25x minimum; current 1.0x is unsustainable
- Debt refinancing activity and terms - monitor if cost of debt increases materially given tight coverage
- Operating cash flow sustainability and working capital changes to assess cash generation quality going forward
Financial Metrics
Revenue
194.8M
Net Income
143.1M
EPS (Diluted)
$1.08
Free Cash Flow
88.9M
Total Assets
5.8B
Cash
37.1M
Profitability Ratios
Gross Margin
N/A
Operating Margin
19.3%
Net Margin
73.5%
ROE
5.2%
ROA
2.5%
FCF Margin
45.6%
Balance Sheet & Liquidity
Current Ratio
N/A
Quick Ratio
N/A
Debt/Equity
0.94x
Debt/Assets
50.6%
Interest Coverage
0.99x
Long-term Debt
2.6B
Disclaimer: This analysis is generated by AI based on publicly available SEC EDGAR filings.
It does not include stock price data and should not be considered financial advice.
All fundamental data is sourced from SEC public domain filings.
Always conduct your own research before making investment decisions.
Data Source: SEC EDGAR |
Analysis Date: 2026-04-29T13:52:37.190240 |
Data as of: 2026-03-31 |
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