Investment Thesis
UDR demonstrates strong operating margins (54%) and solid free cash flow generation ($125.4M), but faces significant headwinds from unclear growth quality. The extreme 14,971% revenue surge with only 1.3% net income growth indicates either major acquisition integration challenges or earnings dilution, while the critically low cash position ($1.3M) combined with 1.72x leverage raises liquidity concerns that offset operational strengths.
Strengths
- Exceptional operating margin of 54% demonstrates operational efficiency
- Strong free cash flow generation of $125.4M (29.4% FCF margin)
- Solid interest coverage ratio of 4.7x supports debt servicing ability
- Net margin of 44.6% reflects strong profitability on core operations
Risks
- Revenue growth of 14,971% YoY coupled with only 1.3% net income growth indicates severe earnings dilution or acquisition-related challenges
- Cash position of $1.3M is critically low for a $10.3B asset base, creating potential liquidity stress
- Debt/equity ratio of 1.72x combined with minimal cash reserves restricts financial flexibility
- Low ROE (5.8%) and ROA (1.8%) suggest inefficient capital deployment
- Absence of current and quick ratios prevents full liquidity assessment
Key Metrics to Watch
- Quarterly revenue growth trend to determine if 14,971% growth is sustainable or one-time event
- Cash position trajectory and working capital management improvements
- Operating cash flow sustainability and FCF conversion quality
- Debt reduction progress and path to improved leverage ratios
Financial Metrics
Revenue
425.8M
Net Income
189.8M
EPS (Diluted)
$0.57
Free Cash Flow
125.4M
Total Assets
10.3B
Cash
1.3M
Profitability Ratios
Gross Margin
N/A
Operating Margin
54.0%
Net Margin
44.6%
ROE
5.8%
ROA
1.8%
FCF Margin
29.4%
Balance Sheet & Liquidity
Current Ratio
N/A
Quick Ratio
N/A
Debt/Equity
1.72x
Debt/Assets
60.3%
Interest Coverage
4.73x
Long-term Debt
5.7B
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: 2026-05-06T16:35:20.630108 |
Data as of: 2026-03-31 |
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