NASDAQ-Traded REIT Loses 89% Of Value In 17 Months

Industrial Logistics Properties Trust ILPT traded at $27 in October 2021 and now goes for $2.97 — one of the steepest declines among real estate investment trusts (REITs). The company is reeling from the effects of interest-rate hikes and a general drop in the value of real estate. 

With a market capitalization of $181 million, it’s not a major REIT, but that big of a loss in value gets noticed.

Funds from operations (FFO) over the most recent 12 months was negative 289% and for the past five years, FFO is negative 37%. Based in Newton, Massachusetts, the NASDAQ-traded company owns 413 logistics and industrial properties totaling 60 million square feet. 

Long-term debt that’s five times the amount of shareholder equity is an issue for Industrial Logistics Properties as the Federal Reserve’s rate hikes keep coming. Value investors tend to avoid securities with that kind of long-term debt-to-equity ratio. The REIT is trading at just 24% of its book value. The price-to-sales metric is 0.47.

The short float of 4.19% is higher than most other REITs, an indication of a lack of confidence. Average daily volume is 1.33 million shares.

Industrial Logistics pays a 1.35% dividend.

The daily price chart is here:

It’s trading below both its 50-day moving average (the blue line) and its downtrending 200-day moving average, a bearish formation. The relative strength indicator (RSI) below the price chart dipped into the Oversold range and is still in it despite the slight bounce in price over the last few days.

The weekly price chart looks like this:

You can see the drop from the $27 level in October/November 2021 down to just below $3. The reddish volume bars, below the price chart (showing selling), are trending larger and larger. The 50-week moving average crossed below the 200-week moving average in August and hasn’t looked back.

Not investment advice. For educational purposes only.

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