Alexander's, Inc. (ALX) Cash Flow Statement

The reported AFFO for 2026Q2 is $157.1M, which is more than three times the $46.2M dividend paid, but this AFFO is inflated by a one-time gain that also boosted net income to $155.4M. Excluding that gain, underlying AFFO is likely around $13-15M, similar to prior quarters, which would cover the quarterly dividend of $23.1M only partially. This suggests that the dividend is not fully covered by recurring AFFO, and investors should monitor whether the company will rely on additional one-time gains or external funding to sustain distributions.

The wide gap between net income and operating cash flow in 2026Q2 (net income of $155.4M vs OCF of $6.2M) highlights the impact of non-cash items, including a likely gain on asset sale or revaluation. FFO, which adds back depreciation, is also elevated at $163.6M, but this is not indicative of recurring cash generation. Historically, FFO has ranged from $12M to $26M per quarter, so the 2026Q2 figure is an outlier. This distortion underscores the need to focus on normalized FFO and AFFO when assessing the company's ability to pay dividends.

The volatility in operating cash flow, with negative quarters in 2025Q3 and 2024Q3, indicates that working capital items such as tenant receivables and payables can cause significant swings. Given the revenue decline of 5.8% YoY, there may be tenant rent concessions or slower collections, which could be reflected in receivable build-ups. Straight-line rent accounting, which averages lease payments over the term, may also inflate reported revenue relative to cash received, so investors should monitor the gap between revenue and cash collections.

The company has not reported any external financing activity in the provided quarters, and dividends have been paid consistently. However, in quarters where operating cash flow was negative (e.g., 2025Q3), the company likely used its cash reserves to cover the dividend. The high cash balance of $128M suggests a liquidity cushion, but it also indicates that management is not deploying capital for growth, possibly due to anticipated capex or debt maturities. This conservative approach may limit upside but supports dividend stability in the near term.