Essex Property Trust, Inc. (ESS)
Quantitative Summary
DeterministicAt 30.7x earnings — a 35% discount to the sector average of 47.4x — ESS is in the lower valuation range. Financial health is average: Piotroski 5/9, Altman Z 1.7. Near modeled fair value — DCF estimates $231 (-7%).
Generated deterministically from quant metrics and financial statements. Not a recommendation.
Algorithmic Teardown
AI-GeneratedThe fundamental economics of this real estate operator reveal a capital structure under pressure, evidenced by an ROIC-WACC spread contracting to -1.9%, indicating that current returns on invested capital fail to cover the cost of equity and debt financing. Despite a robust net margin of 35.5% driving an ROE of 11.7%, this profitability is heavily reliant on significant leverage, as shown by an equity multiplier of 2.29x rather than superior asset turnover or operational efficiency. While the Beneish M-Score of -2.84 suggests low earnings manipulation risk and a Piotroski F-Score of 5/9 indicates moderate financial strength, the Altman Z-Score of 1.7 flags potential distress given its proximity to insolvency thresholds, creating a tension between high-margin operations and capital allocation inefficiencies.
Valuation metrics present a dichotomy where current pricing appears detached from intrinsic value models yet remains compressed relative to sector peers. The stock trades at a P/E multiple of 23.8x, significantly below the REIT sector average of 87.1x, suggesting limited growth expectations are baked into the price despite revenue growing by 6.4% year-over-year. However, discounted cash flow analysis implies a fair value of $232 with -4.2% downside from current levels, aligning with conservative long-term free cash flow growth assumptions of only 4.4% over the next decade. This valuation gap reflects market skepticism regarding whether the high margins can sustainably translate into distributable cash flows given the negative spread between return on capital and the weighted average cost of capital.
Risk-adjusted performance data further complicates the investment thesis, as the stock has generated a Fama-French alpha of -33.50% annually, underperforming risk factors despite holding a positive 0.429 tilt toward value characteristics per the HML factor. The Profitability Factor (RMW) remains neutral at 0.082, and insider activity over the past 90 days shows zero net flow, signaling neither aggressive accumulation nor distribution by management. Collectively, these indicators suggest a security that offers defensive valuation relative to its sector but carries elevated capital structure risks and has historically failed to outperform on risk-adjusted return metrics.
Generated by LLM from quantitative data inputs. May contain inaccuracies. Not investment advice.
DCF Sandbox
Interactive5-year two-stage DCF. Terminal growth 3%. Default sliders match the pre-computed base case. Drag to explore scenarios. Not investment advice.
The growth rate the market implicitly expects over the next 10 years to justify today's price. Compare with historical growth of 6% YoY revenue.
Sensitivity Matrix
| TG ↓ / WACC → | 6% | 7.8% | 9.8% |
|---|---|---|---|
| 2% | $316 | $183 | $109 |
| 3% | $437 | $231 | $132 |
| 4% | $680 | $305 | $164 |
Center = base case. Green = >10% upside, Red = >10% downside vs $277.57.
Pre-computed DCF: WACC=7.8%, terminal growth 3%. Fair value $231 (-7.0%). Not investment advice.
Valuation Context
Currently trading 3% below its 5-year average P/E of 24.7x.
Price Chart with Moving Averages
Technical Setup
AI GeneratedEssex Property Trust, Inc. is currently trading at $272.63 within the Real Estate sector, presenting a technical snapshot that requires careful evaluation of its risk profile. The absence of specific drawdown metrics or volatility indices in the provided data limits a granular assessment of recent price stability, yet the current valuation level serves as a critical reference point for understanding potential downside exposure relative to historical norms. Without concrete figures on maximum recent declines or standard deviation measures, it remains unclear whether any existing downward pressure stems from transient market noise or deeper structural shifts within the broader real estate landscape. The fundamental backdrop of the housing and commercial sectors often dictates momentum durability, but without explicit correlation data between macroeconomic indicators and ESS's price action, the resilience of its current trajectory is ambiguous. If recent movements are driven solely by sector-wide headwinds rather than company-specific catalysts, any apparent strength may be fragile and susceptible to rapid erosion should fundamental conditions deteriorate further. Conversely, if the stock has maintained stability despite regional volatility, this could suggest a more robust underlying demand structure capable of withstanding adverse market cycles. Ultimately, determining whether observed momentum is structural or precarious hinges on unseen variables such as lease renewal rates, occupancy trends, and interest rate sensitivity that are not captured in the single price point provided. The technical setup at $272.63 exists within a context where risk dynamics remain partially opaque without additional historical performance data to calibrate volatility estimates or measure recent drawdown severity against
Quant Health Deep Dive
Profitability & Value Creation
✅ Conservative payout — room for dividend increases.
DuPont Analysis — ROE Decomposition
Breaking down Return on Equity to see how the company generates its ROE — efficiency, margins, or leverage.
Balance Sheet Health
Earnings Surprise History
EPS estimates vs actuals for the most recent reported quarters. Source: yfinance.
Dividend History
| Date | Amount | Change |
|---|---|---|
| 2026-03-31 | $2.5900 | +0.8% |
| 2026-01-02 | $2.5700 | 0.0% |
| 2025-09-30 | $2.5700 | 0.0% |
| 2025-06-30 | $2.5700 | 0.0% |
| 2025-03-31 | $2.5700 | +4.9% |
| 2025-01-02 | $2.4500 | 0.0% |
| 2024-09-30 | $2.4500 | 0.0% |
| 2024-06-28 | $2.4500 | 0.0% |
| 2024-03-27 | $2.4500 | +6.1% |
| 2023-12-29 | $2.3100 | 0.0% |
| 2023-09-28 | $2.3100 | 0.0% |
| 2023-06-29 | $2.3100 | 0.0% |
Dividend and split data from SEC filings and market data. Amounts are per share, not adjusted for splits. Source: yfinance.
Risk Profile
Sharpe = risk-adjusted return (higher is better). Max drawdown = largest peak-to-trough decline. 1,200+ trading days.
Underwater (Drawdown from Peak)
How far below the all-time high the price has been over time. Deeper = more pain for holders.
Rolling 60-Day Beta vs S&P 500 (VOO)
How the stock's sensitivity to market moves changes over time. β > 1 = more volatile than the market.
Fama-French 5-Factor Exposure
Academic factor model decomposition — what's really driving this stock's returns.
Fama-French 5-Factor Model. Data: Kenneth French Data Library. Regression over 3 years of daily returns.
Fundamentals
Passive Flow Attribution
ETF Draft EffectWhen investors buy or sell ETFs like XLRE or NOBL, the fund manager is mechanically forced to buy or sell ESS shares regardless of Essex Property Trust, Inc.'s individual fundamentals. We estimate $3.5B of passive capital is structurally linked to ESS through 8 tracked ETFs. Index rebalances and ETF creation/redemption cycles can create noticeable volume spikes unrelated to company news.
Passive exposure = Σ (ETF AUM × stock weight in ETF) across 8 tracked ETFs. Actual passive ownership is larger (includes mutual funds). Not investment advice.
ETF Contagion Visualizer
Simulate a price drop in Essex Property Trust, Inc. to visualize passive redemption contagion across ETFs and collateral stocks.
If Essex Property Trust, Inc. (ESS) experiences a significant drawdown, ETF redemptions can create collateral selling pressure on co-held stocks. Our model identifies WELLTOWER INC (WELL) as the most exposed collateral stock, sharing 1 ETFs with ESS. This is the "Passive Contagion" effect described in the Inelastic Market Hypothesis.
Contagion model based on shared ETF exposure and constituent weights across 34 tracked ETFs. Estimated selling pressure is a simplified model — actual impact depends on market liquidity, ETF redemption mechanics, and market-maker activity.
ESS Ownership Dynamics
Passive funds hold 1 in every 5 ESS shares, reducing daily market volatility.
Essex Property Trust, Inc. (ESS) exerts notable gravity on the passive index market, currently representing 1.8% of the State Street Real Estate Select Sector SPDR ETF (XLRE) and 1.4% of the ProShares S&P 500 Dividend Aristocrats ETF (NOBL). Across 34 tracked ETFs, approximately 14M shares (22.2% of float) are held by passive funds and rarely trade on the open market. This high passive lock-up reduces the effective active float, which can amplify daily price volatility and momentum signals.
ETFs with Highest ESS Exposure
Float lock-up computed from 34 ETFs tracked by SecuritiesDB. Actual passive ownership is higher (includes mutual funds, pension funds, etc.).
ESS Institutional Volume Profile
252-day volume distribution by price level. The Point of Control (POC) marks — the price where the most institutional volume transacted — an implicit support/resistance floor.
The highest-volume price zone for Essex Property Trust, Inc. over the past year sits near $254.69 (14% of 252-day volume). The current price of $277.57 trades 9.0% above this institutional floor — a sign of upside momentum, though a pullback to the POC zone is a common reversion target. The highly concentrated volume profile (14% at POC) indicates strong consensus on fair value — institutional participants have repeatedly transacted near this price.
Volume Profile computed from 252 trading days of OHLCV data. Volume allocated to price bins proportionally based on daily high-low range. Not investment advice.
ESS Capital Efficiency
How efficiently does Essex Property Trust, Inc. convert operating profits into free cash? The FCF Conversion ratio measures the gap between accounting earnings and real cash generation.
Essex Property Trust, Inc. converts 60% of its EBITDA into free cash flow, a healthy conversion rate indicating efficient capital management — the business generates substantial cash after reinvestment. However, the ROIC-WACC spread is negative (-1.9%), suggesting reinvested capital is destroying shareholder value.
Capital efficiency = Free Cash Flow ÷ EBITDA. Reinvestment = (EBITDA − FCF) ÷ EBITDA. Metrics from latest annual filings. Not investment advice.
Fails-to-Deliver (FTD) History
SEC-reported settlement failures. Elevated FTDs can indicate high short-selling pressure, operational settlement issues, or naked shorting activity.
| Date | Failed Shares | Close Price | Notional Value |
|---|---|---|---|
| 2026-05-14 | 2 | $271.94 | $543.88 |
| 2026-05-13 | 4 | $268.64 | $1,074.56 |
| 2026-04-30 | 566 | $264.92 | $149,944.72 |
| 2026-04-23 | 88 | $252.19 | $22,192.72 |
| 2026-04-15 | 3 | $251.42 | $754.26 |
| 2026-04-07 | 106 | $247.71 | $26,257.26 |
| 2026-03-31 | 377 | $242.61 | $91,463.97 |
| 2026-03-25 | 6 | $243.50 | $1,461 |
| 2026-03-24 | 18,632 | $242.58 | $4.5M |
| 2026-03-13 | 3,924 | $251.38 | $986,415.12 |
| 2026-03-10 | 392 | $255.34 | $100,093.28 |
| 2026-03-02 | 86 | $255.11 | $21,939.46 |
| 2026-02-25 | 64 | $258.40 | $16,537.6 |
| 2026-02-06 | 15,054 | $251.49 | $3.8M |
| 2026-02-05 | 668 | $252.57 | $168,716.76 |
| 2026-02-03 | 898 | $248.46 | $223,117.08 |
| 2026-01-08 | 100 | $251.06 | $25,106 |
| 2025-12-24 | 19 | $259.69 | $4,934.11 |
| 2025-12-23 | 28 | $260.84 | $7,303.52 |
| 2025-12-10 | 4 | $252.20 | $1,008.8 |
| 2025-11-26 | 660 | $261.16 | $172,365.6 |
| 2025-11-25 | 1,733 | $260.25 | $451,013.25 |
| 2025-10-29 | 1,875 | $256.15 | $480,281.25 |
| 2025-10-16 | 528 | $257.15 | $135,775.2 |
| 2025-10-03 | 146 | $263.88 | $38,526.48 |
| 2025-10-02 | 2,565 | $266.59 | $683,803.35 |
Source: SEC Regulation SHO FTD data. Data is reported with a ~30 day delay. High FTD quantities relative to average daily volume may indicate settlement stress.
Price Correlations
Statistical correlation of daily returns with other stocks. High correlations indicate stocks that move together; negative correlations can offer diversification.
| Peer | 252-Day (1Y) | 126-Day (6M) | Direction |
|---|---|---|---|
| WTGXX | NaN | NaN | |
| EQR | 0.868 | 0.831 | High co-movement |
| UDR | 0.856 | 0.841 | High co-movement |
| AVB | 0.853 | 0.811 | High co-movement |
| CPT | 0.851 | 0.824 | High co-movement |
| MAA | 0.824 | 0.798 | High co-movement |
| VRTPX | 0.748 | 0.649 | High co-movement |
| AMH | 0.700 | 0.676 | High co-movement |
| INVH | 0.698 | 0.628 | Moderate |
| FRT | 0.652 | 0.622 | Moderate |
Pearson correlation of daily log returns. 252d ≈ 1 trading year. Computed from price history. Not investment advice.
Compare ESS to Peers
Quant metrics computed deterministically from financial statements and price data. Updated: 2026-06-02.
SecuritiesDB provides programmatic data aggregation for informational purposes only. None of the metrics, summaries, or algorithmic flags constitute a recommendation to buy or sell any security.