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Investing.com - KeyBanc upgraded Global Net Lease (NYSE:GNL) from Sector Weight to Overweight on Tuesday, setting a price target of $9.00. The REIT, currently valued at $1.65 billion, offers an attractive dividend yield of 10.16% and trades at an EBITDA multiple of 8.04x. According to InvestingPro analysis, the stock appears slightly undervalued based on its Fair Value estimates.
The upgrade follows Global Net Lease’s successful execution of its internalization and capital recycling strategy since its merger with RTL in September 2023. The company has sold $3 billion in non-core assets since the beginning of the first quarter of 2024, including a $1.8 billion multi-tenant portfolio sale announced earlier this year. InvestingPro data shows the company maintains strong liquidity with a current ratio of 6.21, indicating robust financial flexibility to execute its strategy.
These divestments have significantly improved the company’s portfolio metrics, with leased percentage increasing to 98% from 96% in the fourth quarter of 2023. Additionally, NOI margins improved to 90% from 82% before the multi-tenant transaction, while rent escalators increased to 88% of straight-line rent from 78% in the fourth quarter of 2023.
KeyBanc acknowledged that Global Net Lease’s office exposure, currently at 27% of straight-line rent, remains relatively high compared to peers. However, the firm noted management’s intention to reduce office exposure over time, potentially through portfolio sales if opportunities arise.
According to KeyBanc, these changes have transformed Global Net Lease into a pure-play single-tenant Net Lease REIT, bringing it more in line with its Net Lease peers. Analyst consensus compiled by InvestingPro shows price targets ranging from $8 to $12, with additional insights available in the comprehensive Pro Research Report, which provides deep-dive analysis of GNL alongside 1,400+ other US equities.
In other recent news, Global Net Lease Inc. announced its second-quarter 2025 financial results, which showed a larger-than-anticipated loss. The company reported an earnings per share (EPS) of -$0.19, which did not meet analysts’ expectations of -$0.13. Additionally, Global Net Lease’s revenue was $124.9 million, falling short of the projected $137.77 million. Despite these financial shortfalls, the company’s stock experienced a rise, indicating positive investor sentiment toward the company’s strategic changes and operational enhancements. These developments are part of the ongoing shifts within Global Net Lease as it navigates its financial landscape.
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