Baird has revised its price target for Lineage (LINE, Financial), bringing it down to $64 from the previous $70. Despite this adjustment, the firm maintains its Outperform rating on the stock. This change comes as a response to the recent first-quarter results, with the company's second-quarter performance outlook appearing unclear, heightening investor caution.
LINE Key Business Developments
Release Date: April 30, 2025
- Total Revenue: $1.29 billion, down 3% year-over-year.
- Adjusted EBITDA: $304 million, a decrease of 7%.
- Adjusted EBITDA Margin: Down 110 basis points to 23.5%.
- AFFO (Adjusted Funds From Operations): $219 million, up 48%.
- AFFO Per Share: $0.86, a 6% increase versus prior year.
- Same-Store Warehouse Sales: Down 7.9%.
- Same-Store Physical Occupancy: 76.5%.
- Net Debt: $6.7 billion.
- Total Liquidity: $1.7 billion.
- Leverage Ratio: Net debt to adjusted EBITDA at 5.2.
- 2025 Guidance: Adjusted EBITDA range of $1,350 to $1,400 million; AFFO per share of $3.40 to $3.60.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Lineage Inc (LINE, Financial) announced a landmark agreement with Tyson Foods, expected to generate over $100 billion in annual EBITDA once stabilized.
- The company plans to deploy approximately $1 million in capital for acquisitions and new developments, enhancing its position as a top global cold storage company.
- Lineage Inc (LINE) reported a 6% growth in FFO per share, demonstrating resilience despite challenging market conditions.
- The company is maintaining its previous guidance and expects adjusted EBITDA and AFFO per share growth for the full year.
- Lineage Inc (LINE) continues to execute a robust pipeline of development and M&A opportunities, including the acquisition of three warehouse campuses and significant expansions in Europe.
Negative Points
- Total revenue for the first quarter was down 3%, and adjusted EBITDA decreased by 7%, reflecting challenging market conditions.
- Same-store warehouse sales declined by 7.9%, impacted by lower revenue per throughput and customers resetting volume guarantees at lower levels.
- The macroeconomic uncertainty, driven by U.S. tariff announcements, has created hesitancy among customers, affecting near-term activity.
- Lineage Inc (LINE) faces pricing pressure and uncertainty in the short term, with competitive market conditions impacting revenue.
- The company is experiencing challenges in predicting growth levels for the second half of the year due to ongoing macroeconomic uncertainties.
