The St. Joe Company

What they do

St. Joe develops residential communities, hospitality properties and income-producing commercial real estate, all in Northwest Florida. Approximately 87% of its real estate is in Florida's Bay, Gulf and Walton counties, and about 90% of land holdings lie within fifteen miles of the Gulf. The company also operates a real estate brokerage, a title insurance agency and an insurance agency, and uses joint ventures for certain development. A portion of its land sits within the Bay-Walton Sector Plan, which entitles it to develop over 170,000 residential dwelling units, over 22 million square feet of retail, commercial and industrial space and over 3,000 hotel rooms.

Revenue drivers

• Real estate — Sale of developed and unimproved land, primarily residential homesites to homebuilders, generated $234.2 million in 2025, up 63.5% from 2024, making it the largest segment.
• Hospitality — Hotels, resorts and club operations produced $215.4 million in 2025, up 8.1% and a company record; it is the second-largest revenue line and produced $74.2 million in Q2 2026.
• Leasing — Commercial and other income-producing properties generated $63.6 million in 2025, up 5.5% and a record, adding recurring rental revenue.
• Other operating businesses — Real estate brokerage, title insurance and insurance agency operations supplement the core segments, and are cited by management as part of its cross-selling model.

Recent performance

For Q2 2026, total revenue rose 23.0% to $158.8 million from $129.1 million, which management called its highest second-quarter revenue in 20 years. Net income increased 37.3% to $40.5 million, or $0.71 per share, from $29.5 million, or $0.51 per share, described as the highest second-quarter net income in 30 years excluding a one-off 1996 gain on discontinued operations. Real estate revenue rose 58.9% to $69.6 million, and hospitality revenue rose 7.8% to a quarterly record $74.2 million. Gross margin increased in every segment: residential to 48% from 45%, hospitality to 42% from 39%, and commercial to 65% from 57%. For full-year 2025, revenue was $513.2 million, up 27.4%, and net income was $115.6 million, up 55.8%.

Strategy

St. Joe is developing long-term, scalable residential communities, expanding hospitality offerings and growing its portfolio of income-producing commercial properties. Management describes a "Virtuous Circle of Value Creation" in which resort guests become homebuyers, brokerage, title and insurance customers, club members and commercial tenants. The company reports a residential homesite pipeline of over 25,000 units, including over 2,000 already platted or under development and over 1,500 in engineering or permitting. It plans to commence the first phase of two new communities in the Teachee and Pigeon Creek DSAPs in early 2027, obtained approval for the roughly 2,000-unit Park Place East community, and is in discussions with homebuilders not currently in its market. Capital is allocated across development spending, stock repurchases and dividends, with Q2 2026 capital expenditures of $24.0 million, $32.7 million of buybacks and $9.1 million of dividends.

Risks

• Macroeconomic and interest-rate pressure — Elevated interest rates, inflation and higher insurance costs have delayed or prevented some buyers from obtaining financing or selling existing homes, which could slow homesite demand.
• Geographic concentration — With about 87% of real estate in three Florida counties and roughly 90% within fifteen miles of the Gulf, the company is exposed to regional weather, insurance and local market conditions.
• Lumpy, non-linear segment results — Management states that one- to two-year seeding and harvesting cycles and varying homesite pricing per community make residential results non-linear and subject to quarter-to-quarter variation.
• Development timing and entitlement risk — Project timing may be delayed by factors beyond the company's control, and development returns depend on continued entitlements such as the Bay-Walton Sector Plan and new DSAP phases.

Outlook

Management points to continued net migration into Northwest Florida, which it credits for positive results despite national headwinds, and notes that market conditions have not increased homebuilder cancellation rates. The stated runway includes over 25,000 residential homesite units, two new communities planned to start in early 2027 and active talks with additional homebuilders. The company also continues growing hospitality and commercial leasing to expand recurring revenue, while funding commitments from completed project proceeds, cash, owned land, partner capital and financing.