Phillips Edison's grocery-anchored retail REIT generates strong cash flow conversion of 161% and is in a golden cross technical pattern, but 83% of net operating income is concentrated in top-1 or top-2 grocer anchor tenants and the stock is priced above resistance targets, leaving no margin of safety.
Thesis pillars
- Grocer Anchor Concentration↓Deteriorating
- Fcf Conversion Quality↑Improving
- Price Above Resistance↓Deteriorating
- +1 more pillar — see the Why tab for full reasoning
Phillips Edison & Company, Inc. (PECO) Stock Analysis
Range Bound setup
Real Estate · REIT - Retail
Hold if already holding. Not a fresh buy at $42.28, but acceptable to hold if already in. Reasons: REIT tenant concentration cliff: 83% of NOI from #1 or #2 grocer anchors (≥40% threshold). Single-tenant churn risk dominates spot FFO.; Concentration risk — Property Type: grocery-anchored shopping centers (95.0%).
Phillips Edison & Company owns and manages 297 wholly-owned grocery-anchored shopping centers totaling approximately 36.7 million square feet across 31 states, plus partial interests in three unconsolidated joint ventures. Revenue is primarily lease-based from a portfolio that... Read more
Hold if already holding. Not a fresh buy at $42.28, but acceptable to hold if already in. Reasons: REIT tenant concentration cliff: 83% of NOI from #1 or #2 grocer anchors (≥40% threshold). Single-tenant churn risk dominates spot FFO.; Concentration risk — Property Type: grocery-anchored shopping centers (95.0%). Chart setup: RSI 55 mid-range, Bollinger mid-band. Maintain position. Not compelling to add more. Score 5.8/10, moderate confidence.
Passes 6/9 gates (clean insider activity, no SEC red flags, news boost earnings 0.70, earnings proximity 84d clear, semi cycle peak clear, materials cycle peak clear). Fails on weak momentum and favorable risk/reward ratio and reit tenant cliff hard block. Suitability: moderate.
About Phillips Edison & Company, Inc.
About Phillips Edison & Company, Inc.
Phillips Edison & Company's managed portfolio of 297 wholly-owned grocery-anchored neighborhood shopping centers and interests in three unconsolidated joint ventures encompassed approximately 36.7 million square feet in 31 states at December 31, 2025, with the wholly-owned portfolio 97.3% leased. Grocery anchors ranking #1 or #2 by sales in their respective trade areas generated 83.3% of annualized base rent; approximately 70% of ABR derived from necessity-based goods and services tenants.
PECO generates revenue through leases with a diverse mix of national, regional, and local tenants it refers to as "Neighbors," targeting small-format centers averaging 112,000 square feet where retailer demand concentrates in inline spaces under 10,000 square feet of GLA. For the year ended December 31, 2025, combined comparable rent spreads of 23.3% — 30.9% on new leases and 20.7% on renewals — reflect below-market rent recapture as leases expire. The balance sheet carries $2.4 billion in total debt ($2.0 billion unsecured, $0.4 billion secured), supported by investment-grade ratings of Baa2 (Moody's, Stable) and BBB (S&P, Stable) and $925.1 million in total liquidity at year-end, including $881.8 million available on a $1 billion revolving credit facility.
Show full overview
Geographic concentration represents a distinct risk: Florida and California accounted for 12.3% and 10.5%, respectively, of PECO's ABR in 2025 (including joint venture properties), making them the two largest state exposures in the 31-state portfolio. The 10-K explicitly identifies these states as concentration risks subject to local economic conditions, oversupply, insurance costs, and weather events. While neither state alone exceeds 25% of ABR, their combined approximately 22.8% share means a sustained market dislocation in either could weigh on consolidated NOI and occupancy rates.
See also: Real Estate · REIT - Retail
From Phillips Edison & Company, Inc.'s most recent 10-K filing, extracted June 11, 2026.
Recent developments
updated 2026-07-30Recent Developments — Phillips Edison & Company, Inc.
Latest news
- NEWS Phillips Edison & Company, Inc. (PECO) could be a great choice - MSN — MSN positive
- NEWS PECO Maintained by Morgan Stanley -- Price Target Raised to $38 - GuruFocus — GuruFocus positive
- NEWS Phillips Edison (PECO) Q4 2025 Earnings Transcript - The Motley Fool — The Motley Fool neutral
- NEWS Phillips Edison (PECO) Q4 2025 Earnings Transcript - AOL.com — AOL.com neutral
- NEWS Phillips Edison Rating: Morgan Stanley Maintains Equal-Weight - TradeKaizen — TradeKaizen neutral
Generated 2026-07-31T02:43:38Z.
Upcoming dated catalysts
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- HIGHPropertygrocery-anchored shopping centers95%10-K Item 1: '95.0% of our annualized ... base rent ("ABR") was generated from shopping centers anchored by such grocers'
- HIGHTenant#1 or #2 grocer anchors83%10-K Item 1: '83.3% of our ABR was generated from shopping centers anchored by the #1 or #2 grocer by sales within their respective trade area'
- LOWGeographicFlorida12%10-K Item 1A: 'our holdings in Florida and California accounted for 12.3% and 10.5%, respectively, of our ABR'
- LOWGeographicCalifornia11%10-K Item 1A: 'our holdings in Florida and California accounted for 12.3% and 10.5%, respectively, of our ABR'
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
Show full disclosure ▾Hide full disclosure ▴
About TrendMatrix. TrendMatrix is a publisher of general securities research and market commentary. We publish on a regular schedule. All content is the same for every subscriber in a tier — we do not provide personalized investment advice and we do not take into account any individual subscriber's financial situation, investment objectives, risk tolerance, tax situation, or holdings.
Not investment advice. TrendMatrix is not a registered investment adviser. Our content is for informational and educational purposes only. Consult your own licensed investment adviser, broker, or tax professional before making any investment decision.
Conflicts and positions. The TrendMatrix editorial team frequently holds personal long-term positions in securities discussed. We disclose positions held at the time of publication on each piece. We maintain a trading-window policy: we do not initiate or close positions in the same direction as a TrendMatrix publication within 24 hours before or 72 hours after publication.
No paid promotion. TrendMatrix does not accept payment from any issuer, broker, or third party in exchange for coverage of any security. Our sole compensation is subscription revenue.
No fiduciary duty. No fiduciary, advisory, or agency relationship is created between you and TrendMatrix by reading our content or subscribing to our service.
Performance. Past performance is not indicative of future results. Performance figures reflect the published model only and do not reflect any individual subscriber's actual results.
Rating Breakdown
1 floor-breaker
Momentum below the gate floor. Component breakdown shows what dragged the score down.static
Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Hold if already holding. Not a fresh buy at $42.28, but acceptable to hold if already in. Reasons: REIT tenant concentration cliff: 83% of NOI from #1 or #2 grocer anchors (≥40% threshold). Single-tenant churn risk dominates spot FFO.; Concentration risk — Property Type: grocery-anchored shopping centers (95.0%). Chart setup: RSI 55 mid-range, Bollinger mid-band. Maintain position. Not compelling to add more. Target $43.49 (+2.9%), stop $40.75 (−3.8%), A.R:R -1.3:1. Score 5.8/10, moderate confidence.
Take-profit target: $43.49 (-6.5% upside). Target $43.49 (+2.9%), stop $40.75 (−3.8%), A.R:R -1.3:1. Stop-loss: $40.75.
REIT tenant concentration cliff: 83% of NOI from #1 or #2 grocer anchors (≥40% threshold). Single-tenant churn risk dominates spot FFO.; Concentration risk — Property Type: grocery-anchored shopping centers (95.0%); Concentration risk — Tenant: #1 or #2 grocer anchors (83.3%).
Phillips Edison & Company, Inc. trades at a P/E of 37.5 (forward 60.6). TrendMatrix value score: 4.1/10. Verdict: Hold.
20 analysts cover PECO with a consensus score of 3.9/5. Average price target: $45.
What does Phillips Edison & Company, Inc. do?Phillips Edison & Company owns and manages 297 wholly-owned grocery-anchored shopping centers totaling approximately...
Phillips Edison & Company owns and manages 297 wholly-owned grocery-anchored shopping centers totaling approximately 36.7 million square feet across 31 states, plus partial interests in three unconsolidated joint ventures. Revenue is primarily lease-based from a portfolio that was 97.3% leased at year-end 2025, with approximately 70% of ABR from necessity-based retailers and 83.3% from centers anchored by the #1 or #2 grocer.