NETSTREIT launches new $300 million equity sales program

Published 12/08/2024, 22:42
NETSTREIT launches new $300 million equity sales program

NETSTREIT Corp. (NYSE:NTST), a real estate investment trust, announced today the initiation of a new at-the-market equity offering program. Under the agreement with several financial institutions, the company may sell up to $300 million of its common stock.

The Dallas-based company entered into the equity offering sales agreement on Monday, with the operating partnership NETSTREIT, L.P., and various agents including Wells Fargo Securities, LLC and BofA Securities, Inc. This move allows for the sale of common stock through "at-the-market" offerings, which may occur on the New York Stock Exchange or other marketplaces.

The agents involved are entitled to a commission not exceeding 1.5% of the gross sales price for shares sold. The company has the option to engage in forward sale agreements with entities such as Goldman Sachs and Jefferies LLC, where shares will be sold by borrowing from third parties.

NETSTREIT plans to use the net proceeds from this offering for general corporate purposes, potentially including property acquisitions and development activities. The company has stated that it will not initially receive proceeds from the sale of borrowed shares by forward sellers but expects to receive net cash proceeds upon settlement of the forward sale agreements unless they elect to settle in cash or shares.

The new program replaces a previous sales agreement dated October 25, 2023, which has been terminated in conjunction with this announcement. Under the prior agreement, NETSTREIT sold approximately $108.1 million in common stock and has one unsettled forward agreement for 1,743,100 shares, which may be physically settled by April 12, 2025.

In other recent news, NETSTREIT Corp. has reported a steady second quarter in 2024, maintaining its focus on strategic growth and portfolio diversification. Despite reporting a net loss of $2.3 million, the real estate investment trust declared a quarterly cash dividend of $0.21 per share, signaling continued resilience. The company reported over $116 million in gross investment activity, with a 7.5% blended cash yield, and added Life Time Fitness as a new tenant, indicating a commitment to diversification.

In recent developments, NETSTREIT commenced rent on six development projects and maintained its 2024 AFFO per share guidance of $1.25 to $1.28. The company's portfolio now comprises 649 investments, leased to 90 tenants across 45 states. In addition, the firm has a strong dialogue with Walgreens, suggesting minimal impact from Big Lots (NYSE:BIG) store closures.

NETSTREIT's new CEO is expected to focus on optimizing a larger portion of the source, and the company plans to extend debt maturities in the coming years. The company's approach to re-tenanting, acquisition pace, and balance sheet management was also highlighted, suggesting a steady path forward despite recent challenges.

InvestingPro Insights

As NETSTREIT Corp. (NYSE:NTST) embarks on its new at-the-market equity offering program, InvestingPro data and tips provide valuable insights for investors considering the company's stock. The company's market capitalization stands at approximately $1.21 billion, with a notable price-to-earnings (P/E) ratio of 224.93. However, when adjusted for the last twelve months as of Q2 2024, the P/E ratio is more favorable at 83.71. Additionally, NETSTREIT has demonstrated robust revenue growth of 30.09% over the same period, signaling potential for future expansion.

InvestingPro Tips suggest that analysts expect NETSTREIT's net income and sales to grow this year, which aligns with the company's strategy to use the proceeds from the equity offering for property acquisitions and development. Furthermore, the company's liquid assets surpassing short-term obligations and a strong gross profit margin of 88.11% as of Q2 2024 underscore its financial health. Currently, there are 8 additional InvestingPro Tips available for NETSTREIT, which can be accessed for more detailed investment analysis.

With a dividend yield of 5.46% and a history of dividend growth, NETSTREIT may also appeal to income-focused investors. While the recent price total return metrics indicate a downward trend, the stock's oversold status according to the RSI may suggest a potential entry point for value investors. The anticipated profitability for the year and the fair value estimates ranging from $15.6 to $19 provide a perspective on the stock's valuation. For investors seeking a comprehensive view, these InvestingPro Tips and data metrics offer a deeper understanding of NETSTREIT's financial position and market potential.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers
© 2007-2025 - Fusion Media Limited. All Rights Reserved.