Core Thesis - Americold Realty Trust, Inc. (COLD) is trading at a historic discount despite its strategic position in the cold storage REIT sector, which controls nearly half of the U.S. market [2][4] Market Position and Valuation - COLD's shares were trading at $10.99 as of December 1st, with a forward P/E of 119.05, indicating a significant valuation multiple collapse compared to historical levels [1][3] - Both Americold and its peer Lineage are trading at implied cap rates above 10%, contrasting sharply with historical transaction levels of 5-6% [3] Industry Dynamics - The cold storage sector is experiencing cyclical weakness due to lower storage volumes and soft consumer demand, but month-over-month inventory increases suggest potential stabilization [2] - The potential resumption of agricultural trade between the U.S. and China could provide a near-term tailwind for the sector, particularly with renewed soybean purchases [3] Future Outlook - Occupancy rates are expected to rise as inventories build in the second half of the year, with forward guidance for 2026 likely to be a key catalyst for sentiment recovery [2][4] - Americold is positioned for a recovery in both occupancy and pricing power as supply tightens and macro conditions improve, offering a compelling investment opportunity for those with a 12-24 month horizon [4]

Core Viewpoint - Americold Realty Trust is actively participating in the Nareit REITworld: 2025 Annual Conference, showcasing its leadership in temperature-controlled logistics and reaffirming its financial outlook for 2025 [1][2] Company Overview - Americold Realty Trust is a global leader in temperature-controlled logistics and real estate, with over 120 years of innovation and reliability [3] - The company operates more than 230 facilities across North America, Europe, Asia-Pacific, and South America, totaling approximately 1.4 billion refrigerated cubic feet [3] Services and Operations - Americold's facilities play a crucial role in the global food supply chain, connecting various stakeholders with tailored, value-added services [4] - The company leverages deep industry expertise, smart technology, and sustainable practices to deliver world-class service [4]

Company Overview - Americold Realty Trust (COLD) is a cold-storage REIT managing 1.4 billion cubic feet of storage globally across 235 warehouses [1] - COLD's stock price has deteriorated by 50.5% year-to-date due to a glut of supply in the market [1] Investment Insights - The company is currently paying dividends, although specific figures are not provided in the text [1]

Core Insights - Americold has been recognized as a 2025 GRESB Sector Leader in the Americas, Industrial category, highlighting its strong sustainability performance [1][2] - The GRESB Sector Leader Awards acknowledge organizations that set benchmarks for sustainability leadership, with Americold exemplifying this through its commitment to environmental initiatives [2][4] - Americold integrates sustainability into its operations, focusing on energy efficiency, emissions reduction, water stewardship, and waste minimization [3][4] Company Overview - Americold Realty Trust, Inc. is a global leader in temperature-controlled logistics and real estate, with over 230 facilities worldwide, totaling approximately 1.5 billion refrigerated cubic feet [6] - The company plays a crucial role in the global food supply chain, connecting various stakeholders with tailored services supported by reliable supply chains [7] Sustainability Commitment - The recognition from GRESB reflects Americold's ongoing efforts to enhance energy efficiency and operational excellence [4] - The company’s approach to sustainability is embedded in its governance and risk management practices, demonstrating a comprehensive commitment to environmental responsibility [3]

Core Viewpoint - The focus is on identifying undervalued stocks with a strong potential for high returns while managing risks effectively [1] Group 1 - The investment strategy emphasizes the importance of understanding the assets owned to limit risks and maximize upside potential [1] - Simplicity in investment ideas is highlighted as a key factor, with a preference for contrarian approaches [1]

Core Insights - Focusing solely on Dividend Aristocrats and Dividend Kings may overlook other significant investment opportunities in the dividend space [1][2] - Identifying lesser-known, high-risk, high-yield dividend stocks can lead to higher yield-on-cost for investors in the long run [2][3] Company Analysis - Americold Realty Trust (COLD) is a real estate investment trust (REIT) that operates a large network of food industry warehouses and has recently expanded its operations by securing exclusive rights to export Irish meat to the U.S. [7][8] - In its latest financial report, Americold experienced a 1% year-over-year decline in sales, totaling $664 million, while its net loss increased by nearly 205% to $11 million, attributed to rising operating costs and softening demand [8] - Despite these challenges, Americold has a market capitalization of approximately $3 billion, indicating potential for growth as a small to mid-sized company [9]

Core Insights - Americold Realty Trust is a key player in the temperature-controlled warehousing and logistics sector, focusing on storage and transportation for perishable goods [1] - The company reported a revenue of $663.67 million for the quarter ending September 2025, reflecting a 1.6% decrease year-over-year, but achieved an EPS of $0.35, a notable improvement from a loss of $0.01 in the same quarter last year [2] - The revenue slightly surpassed the Zacks Consensus Estimate of $660.39 million, indicating a positive surprise of 0.5%, while the EPS met the consensus estimate exactly [3] Stock Performance - Currently, Americold's stock is priced at $11.86, down 7.13% with a change of $0.91, and has fluctuated between a low of $11.49 and a high of $12.54 on the same day [4] - Over the past year, the stock reached a high of $24.74 and a low of $11.49, showcasing significant volatility [4] - The company's market capitalization is approximately $3.38 billion, with a trading volume of 12.5 million shares on the NYSE [4] Analyst Insights - RBC Capital has set a price target of $13 for Americold, suggesting a potential upside of about 9.61% from the current stock price [1] - Despite the recent revenue decline, the significant improvement in EPS and the positive revenue surprise may indicate better-than-expected financial performance, which could be a positive signal for investors [5]

Warehouse Operations - As of September 30, 2025, the company operated 235 warehouses globally, totaling approximately 1.4 billion cubic feet, with 191 in North America, 24 in Europe, 18 in Asia-Pacific, and 2 in South America [143]. - As of September 30, 2025, the company operates a total of 235 warehouses, with 223 being same store warehouses [168]. - Average economic occupied pallets decreased by 4.2% to 4,057 for the three months ended September 30, 2025, compared to 4,237 in the same period of 2024 [193]. - Economic occupancy percentage declined by 290 basis points to 73.8% for the three months ended September 30, 2025, compared to 76.7% in the same period of 2024 [193]. - The average physical occupancy percentage decreased by 380 basis points to 62.8% for the three months ended September 30, 2025, compared to 66.6% in the same period of 2024 [193]. - Same store contribution (NOI) declined by $5.8 million, or 2.9%, compared to the prior year [198]. - Economic occupancy percentage for same store decreased by 280 basis points to 75.5% [198]. Financial Performance - Total revenues for the warehouse segment decreased by $4.8 million, or 0.8%, on a constant currency basis for the three months ended September 30, 2025, compared to the same period in 2024 [194]. - Total revenues for the global warehouse segment for the nine months ended September 30, 2025, were $1,776.4 million, a decrease of 1.9% compared to the same period in 2024 [226]. - On a constant currency basis, warehouse segment revenues decreased by $27.6 million, or 1.5%, during the nine months ended September 30, 2025 [227]. - The global warehouse contribution (NOI) for the nine months ended September 30, 2025, was $592.6 million, reflecting a decrease of 1.3% compared to the prior year [226]. - Total same store revenues for the nine months ended September 30, 2025, were $1,719,637 thousand, down 1.8% from the previous year [235]. - Total non-same store revenues for the same period were $56,804 thousand, reflecting a decrease from $59,313 thousand in the prior year [235]. Costs and Expenses - Warehouse segment cost of operations decreased by $1.4 million, or 0.3%, on a constant currency basis for the three months ended September 30, 2025 [195]. - Warehouse segment cost of operations decreased by $21.8 million, or 1.8%, during the nine months ended September 30, 2025, primarily due to lower operating expenses from closed facilities [228]. - Same store costs of operations decreased by $4.0 million, mainly due to lower other services costs and lower power costs [234]. - Selling, general, and administrative expenses increased by $7.3 million, or 11.5%, primarily due to the go-live of Project Orion in North America and Asia Pacific [212]. - Selling, general, and administrative expenses increased by $18.6 million, or 9.9%, driven by the go-live of Project Orion in North America and Asia Pacific, resulting in higher software-related expenses [245]. Project Orion - The company has incurred $212.5 million in implementation costs related to "Project Orion," aimed at enhancing technology systems and business processes, with an unamortized balance of $82.9 million as of September 30, 2025 [148]. - For the three months ended September 30, 2025, selling, general, and administrative expenses increased by $7.3 million, or 11.5%, primarily due to the go-live of Project Orion in North America and Asia Pacific [212]. - Project Orion expenses decreased by $5.6 million, or 13.6%, primarily due to reduced contract labor and professional fees [247]. Acquisitions and Sales - The company completed the acquisition of a temperature-controlled storage facility in Baytown, TX, for total cash consideration of $108.4 million on March 17, 2025 [151]. - The sale of a 14.99% equity interest in the SuperFrio joint venture generated net proceeds of $27.0 million, with a net gain of $2.4 million recognized for the nine months ended September 30, 2025 [152]. - During the nine months ended September 30, 2025, the company sold four facilities for total proceeds of $24.4 million, resulting in a total gain of $11.6 million [153]. - The company recorded a net gain on real estate of $0.1 million during the three months ended September 30, 2025, related to the sale of a previously impaired facility [218]. Debt and Financing - As of September 30, 2025, total outstanding indebtedness was $4,127.6 million, with fixed interest rate debt comprising 91.2% [289]. - Interest expense rose by $7.4 million, or 7.4%, due to an increase in outstanding debt, including the issuance of $500.0 million and $400.0 million Public Notes [254]. - The company completed a public offering of $400,000,000 aggregate principal amount of 5.600% senior unsecured notes due May 15, 2032 [279]. - The proceeds from the issuance of the Public 5.600% Notes were used to repay a portion of borrowings previously outstanding [279]. - The company expects that its funding sources will be adequate to meet its short and long-term liquidity requirements [274]. Market Conditions - Management believes that macroeconomic conditions, including inflation and consumer spending conservatism, will continue to impact future operating results [159]. - A 100 basis point increase in market interest rates would lead to an increase in annual interest expense of approximately $3.6 million, while a decrease would result in a $3.6 million reduction [324]. - The foreign currency risk exposure as of September 30, 2025, was not materially different from the disclosures in the 2024 Annual Report [325].

Financial Data and Key Metrics Changes - The third-quarter AFFO per share was reported at $0.35, aligning with expectations despite ongoing industry challenges from lower consumer demand and increased supply [17][22] - Same-store economic occupancy decreased to 75.5%, reflecting continued demand pressure, while same-store throughput saw a slight sequential increase due to the annual agricultural harvest [22][23] - Same-store NOI contracted from the prior quarter primarily due to seasonal increases in power costs, although rent and storage revenue per economic pallet increased both sequentially and year-over-year [22][23] Business Line Data and Key Metrics Changes - Approximately 30% of capacity and revenue comes from production-attached facilities, which are viewed as valuable assets for future expansion [10] - Four distribution centers account for about 50% of capacity and 40% of revenue, facing pricing competition due to excess capacity [12] - Retail distribution centers represent about 10% of capacity and 20% of revenues, with growth expected as the company expands capabilities overseas [14] Market Data and Key Metrics Changes - The Asia-Pacific region's total warehouse NOI increased by approximately 16% year-to-date, with economic occupancy well over 90% [18] - The macro environment remains challenging, with customer commentary indicating constrained demand, particularly among lower-income consumers [19] - The company anticipates that excess capacity will take a couple of years to be fully absorbed, with pricing gains expected to moderate in the fourth quarter [26][54] Company Strategy and Development Direction - The company aims to grow market share in the fast-turning retail sector and expand its quick service restaurant business into new geographies [6] - A focus on maintaining fixed-commitment contracts is emphasized, as they provide stable cash flows and long-term customer relationships [8][23] - The company is actively managing its real estate portfolio, exiting low-occupancy facilities while evaluating triple-net lease arrangements to drive occupancy levels [20][24] Management's Comments on Operating Environment and Future Outlook - Management believes that current headwinds are largely transitory, with expectations for pricing and occupancy pressures in 2026 [19][25] - The company is confident in the long-term trajectory of the cold storage industry, citing unique value propositions and mission-critical infrastructure [21][27] - Management is focused on identifying new sales opportunities and expanding into potential new sectors, including both food and non-food categories [20][54] Other Important Information - The company has a development pipeline of approximately $1 billion in attractive opportunities, balancing capital allocation with maintaining dividends and an investment-grade profile [24][62] - The company is trading at a significant discount to intrinsic value, with a historically high cap rate of around 10% [29][30] Q&A Session Summary Question: How should we think about throughput over the next 12 months? - Management indicated that throughput is expected to remain challenged due to lower demand, particularly from lower and middle-income consumers, with muted seasonal demand anticipated [32][33] Question: What are you doing to control costs in the business? - Management highlighted effective cost control measures, including matching direct labor to throughput, which has helped maintain handling margins above 12% [35][37] Question: Should we expect more fixed commitment contracts to be up for renewal in the beginning of the year? - Management clarified that contract renewals are spread throughout the year based on when they are signed, rather than being concentrated in specific quarters [41] Question: What happens to low-occupancy facilities from a P&L perspective? - Management explained that costs associated with low-occupancy facilities are generally minimal and may be capitalized once removed from active status, with customers often moved to owned infrastructure [44] Question: How do you see the new competition in the industry? - Management noted that many new market entrants are struggling with unsustainable business models, which could lead to accelerated exits from the market [50][52]

Company Overview - Americold is a global leader in the cold storage industry, operating an integrated network of strategically located warehouses[6, 79] - The company possesses significant scale with a global footprint, including 1,232 million cubic feet of capacity in North America and 114 million cubic feet in Europe[10] - Americold has approximately 13,000 associates and serves around 3,000 customers[10] Financial Performance - The company's LTM PF Core EBITDA is $615 million[12] - Adjusted FFO has grown by 34%, from $299 million in 2021 to $406 million in LTM Q3 2025[14] - Total Segment Contribution NOI has grown by 40%, from $630 million in 2021 to $834 million in LTM Q3 2025[14] Strategic Initiatives - Americold focuses on designing solutions that fit customer needs, supported by an in-house design engineering team[21] - The company leverages strategic partnerships with CPKC and DP World to enhance its service offerings and expand its network[45] - Americold is implementing Project Orion to standardize processes, reduce manual work, and improve analytics[50] Market Position and Growth - Americold holds 18% of the North American cold storage market and 6% of the global market[56] - The company is transitioning from on-demand contracts to fixed storage committed contracts, which now account for 60% of total warehouse rent and storage revenues[63] - Americold is committed to sustainability initiatives, including reducing Scope 1 and 2 emissions by 9.48% from 2021, with a goal of 30% in 2030[75]