Value
6.9/10data confidence 60%| Component | Sub-score |
|---|---|
| P/S | 7.7 |
| EV/EBITDA | 4.5 |
| p ocf | 8.4 |
- ▸P/OCF: 10.0x (FFO proxy — REITs gated off P/E)
AAT · Why this verdict
Why American Assets Trust (AAT) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score5.6/10
ConfidenceHIGH
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
American Assets Trust is a West Coast and Hawaii REIT with excellent cash conversion and heavy insider buying, but office concentration at 52%, a price above the analyst target and weak earnings history cap the case.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Cash conversion is excellent at 291% FCF/NI with a 7/9 Piotroski F-Score, though the company has no competitive moat. Quality breakdown | FCF/NI should stay above 150% over the next 12 months. | →Stable |
| CounterFor a REIT, depreciation inflates FCF relative to net income, so a high FCF/NI ratio is structural and says little about quality. | ||
Insiders made heavy purchases of $20,059,591 (1.183% of market cap), a strong conviction signal. Insider breakdown | Insiders should not reverse into net selling over the next 12 months. | →Stable |
| CounterA single large buyer may be an affiliated holder, so the purchase may reflect that investor's own position rather than broad management views. | ||
Office properties make up 52.0% of the portfolio and the assets are concentrated in California, Washington, Oregon and Hawaii. Bear case | Office share and occupancy should hold steady without a regional shock. | ↓Deteriorating |
| CounterWeak office demand and a single-region economic downturn would hit rents and valuations at the same time. | ||
Price of $21.86 is above the analyst target of $19.97 (upside_pct -8.6%), giving negative reward-to-risk of -1.28 despite bullish momentum with a golden cross. Warnings | Analyst targets should rise toward the price, or price should consolidate toward the target. | ↓Deteriorating |
| CounterMomentum of 6.8 and a golden cross show the trend is intact, and targets often lag recoveries. | ||
Earnings history shows concerns, with 1 beat and 3 misses recently, and the dividend carries a yield trap warning with safety score of 4.0. Catalyst breakdown | EPS should beat estimates in the next two quarters, following the latest $0.13 versus $0.09 expected. | ↑Improving |
| CounterThe latest quarter beat by 44%, which may mark a turn in results. | ||
Cash conversion is excellent at 291% FCF/NI with a 7/9 Piotroski F-Score, though the company has no competitive moat.
→StableQuality breakdown
- Expectation
- FCF/NI should stay above 150% over the next 12 months.
CounterFor a REIT, depreciation inflates FCF relative to net income, so a high FCF/NI ratio is structural and says little about quality.
Insiders made heavy purchases of $20,059,591 (1.183% of market cap), a strong conviction signal.
→StableInsider breakdown
- Expectation
- Insiders should not reverse into net selling over the next 12 months.
CounterA single large buyer may be an affiliated holder, so the purchase may reflect that investor's own position rather than broad management views.
Office properties make up 52.0% of the portfolio and the assets are concentrated in California, Washington, Oregon and Hawaii.
↓DeterioratingBear case
- Expectation
- Office share and occupancy should hold steady without a regional shock.
CounterWeak office demand and a single-region economic downturn would hit rents and valuations at the same time.
Price of $21.86 is above the analyst target of $19.97 (upside_pct -8.6%), giving negative reward-to-risk of -1.28 despite bullish momentum with a golden cross.
↓DeterioratingWarnings
- Expectation
- Analyst targets should rise toward the price, or price should consolidate toward the target.
CounterMomentum of 6.8 and a golden cross show the trend is intact, and targets often lag recoveries.
Earnings history shows concerns, with 1 beat and 3 misses recently, and the dividend carries a yield trap warning with safety score of 4.0.
↑ImprovingCatalyst breakdown
- Expectation
- EPS should beat estimates in the next two quarters, following the latest $0.13 versus $0.09 expected.
CounterThe latest quarter beat by 44%, which may mark a turn in results.
Per-dimension breakdown
Quality
5.4/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.9 |
| ROA | 1.5 |
| Gross margin | 8.4 |
| Op margin | 10.0 |
| Net margin | 2.4 |
| Current ratio | 2.4 |
| FCF quality | 10.0 |
| Moat | 5.2 |
| Piotroski F | 7.8 |
- ▸Excellent cash conversion: 291% FCF/NI
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 7/9
Growth
6.8/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 3.6 |
| EPS growth | 10.0 |
Momentum
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 8.5 |
| OBV | 10.0 |
| MA position | 7.0 |
| Volume | 0.0 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 6.3 |
| Analyst rating | 5.0 |
| Price target | 6.3 |
Insider
5.9/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 9.0 |
| insider conviction | 8.0 |
| holder change | 3.7 |
| notable moves | 3.0 |
- ▸Heavy insider buying — $20,059,591 (1.181% of mkt cap)
Peer rank
3.2/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.9 |
| quality rank | 3.8 |
| growth rank | 3.8 |
Technical
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 4.3 |
| support resistance | 4.5 |
| 52w position | 6.8 |
Risk (lower is worse)
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 6.7 |
| days to cover | 7.0 |
| volatility | 5.6 |
| put call | 0.0 |
| implied vol | 0.0 |
| beta | 7.1 |
| debt equity | 3.7 |
- ▸Elevated put/call: 2.00
- ▸High IV: 85%
- ▸Concentration risks: 2 HIGH, 1 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
3.7/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 0.0 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
| dividend safety | 4.0 |
| news activity | 8.0 |
- ▸Earnings concerns: 1B/3M
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- MOMENTUM:6.2>=5.5
- INSIDER:OK
- 8K:CLEAN
- EARNINGS_PROXIMITY:91d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-1.3=NEGATIVE
Warning (0)
none
Reward-to-Risk
-1.32
Upside
-7.2%
Downside
5.5%
Sizing output
AVOID
SetupRange Bound — RSI 54 mid-range, Bollinger mid-band
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — MCap $1.7B<$5B
Investment implication
The F-path SELL output reflects an overall score of 2.9 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Value at 6.9) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-1.3=NEGATIVE) reinforce the read. Current asymmetry R:R is -1.32 — supplementary context, not the trigger for this path.
The strongest dimensions are Value at 6.9, Growth at 6.8, and Momentum at 6.2; the weakest are Peer rank at 3.2, Catalyst at 3.7, and Risk (lower is worse) at 4.3. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of -1.32 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Strong Cash Conversion
Trip ifFCF/NI falls below 100% from current 291%.
- P2Heavy Insider Buying
Trip ifInsider net selling exceeds 0.5% of market cap in 90 days.
- P3Office And Regional Concentration
Trip ifOffice properties share exceeds 60% of portfolio from current 52.0%.
- P4Price Above Analyst Target
Trip ifPrice falls below the $20.72 stop level, more than 5% below current $21.86.
- P5Weak Earnings And Dividend Risk
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.