Grade: F — Major Red Flags (REIT-Structural)
Framework: Schilit *Financial Shenanigans* + Beneish M-Score + forensic accounting principles
Data: SEC EDGAR 10-K (Filed 2026-02-12, FY ended December 31, 2025) + Yahoo Finance
Auditor: Deloitte & Touche LLP — Unqualified opinion
CIK: 0000906163
One-line verdict: Camden's F grade is mechanically driven by a single red flag: cash of $18M covers only 1% of $3.9B in debt. Every other check passes or is benign. The apartment REIT has zero goodwill, 61.4% gross margins, CFFO/NI of 2.15, FCF of $384M, and Debt/EBITDA of 3.4x (healthy). Revenue grew 1.9% to $1.6B reflecting modest same-store growth in the Sunbelt apartment markets where Camden concentrates. Per the filing, FFO, Core FFO, and Core AFFO are "management considers" key metrics for REIT performance. SG&A/Gross Profit of 8.2% is excellent. This is a well-run apartment REIT with minimal cash on hand — typical for a company that relies on revolving credit facilities and commercial paper for liquidity.
| Metric | Result |
|---|---|
| Red Flags | **1** (Cash-to-debt 1%) |
| Watch Items | **1** (Other assets +24.9%) |
| Checks Completed | **16/18** (2 N/A) |
| Beneish M-Score | N/A (insufficient data) |
| Auditor | Deloitte & Touche LLP — Unqualified opinion |
Apartment REIT Operations
Revenue of $1,574M grew 1.9%, reflecting a "increase in same-store revenue" per the filing. Net income of $384M and CFFO of $827M demonstrate the typical apartment REIT pattern where CFFO exceeds NI by 2x+ due to depreciation on long-lived apartment assets.
The filing notes FFO as the primary performance metric: "Management considers FFO, Core FFO, and Core AFFO" as supplemental measures, following Nareit's definition. Camden's occupancy and leasing strategies focus on "ensuring customer satisfaction, increasing rents as market conditions allow, maximizing rent collections, maintaining property occupancy, and staggering lease terms such that lease expirations are matched with seasonal demand."
The D3 watch item (other assets +24.9% vs. revenue +1.9%) may reflect development-related assets or deferred leasing costs. The commercial paper program allows notes "with the aggregate face or principal amount outstanding at any time not to exceed $600 million."
The 18-Point Screening
| # | Check | Result | Detail |
|---|---|---|---|
| A1-A2 | Revenue Quality | ✅ | DSO 2 days (typical apartment REIT), AR flat |
| A3 | Revenue vs CFFO | ✅ | Revenue +1.9%, CFFO +6.7% |
| B1-B4 | Expense Quality | ✅ | 61.4% gross margin, 8.2% SG&A ratio |
| C1-C3 | Cash Flow | ✅ | CFFO/NI 2.15, FCF $384M, accruals -4.9% |
| C4 | Cash vs Debt | ❌ | Cash $18M = 1% of $3.9B debt |
| D1 | Goodwill | ✅ | Zero goodwill |
| D2 | Leverage | ✅ | Debt/EBITDA = 3.4x (healthy) |
| D3 | Soft Assets | ⚠️ | Other assets +24.9% |
| E1-E2 | Acquisition Risk | ✅ | Clean |
Summary
Grade: F is purely REIT-structural. Camden is a clean apartment REIT with 3.4x leverage, zero goodwill, strong cash generation, and excellent cost discipline. The F reflects nothing more than a $18M cash balance — standard for an apartment REIT with commercial paper and revolver access.
**Disclaimer**: This report is based on Camden Property Trust's FY2025 10-K filed with SEC EDGAR on February 12, 2026. This is NOT investment advice.
Data: SEC EDGAR 10-K + Yahoo Finance
Auditor: Deloitte & Touche LLP (Unqualified opinion)
Fiscal year ended: December 31, 2025