Jennifer Mathews

The expected performance of timberland REIT Weyerhaeuser (WY) for the rest 2017 and in 2018 can be best understood by its valuation multiples.

REITs (real estate investment trusts) usually provide generous returns to their shareholders in the form of dividends or share buybacks.

REITs (real estate investment trusts) depend mostly on debt for their day-to-day functioning and working capital.

After thriving for a long time in a low interest rate environment, REITs (real estate investment trusts) are now facing a high interest rate.

REITs (real estate investment trusts) depend on debt and equity for their working capital, and so they’re directly impacted by the Fed’s interest rate policy.

Weyerhaeuser (WY) has undertaken several divestiture policies in order to dispose of its underperforming and non-core businesses.

Timberland REIT (real estate investment trust) Weyerhaeuser (WY) owns almost 13.1 million acres of timberlands across the US.

Timberland REIT (real estate investment trust) Weyerhaeuser (WY) expects to continue its growth trajectory for the rest of 2017.

Timberland REIT (real estate investment trust) Weyerhaeuser (WY) has been able to use the opportunities of the booming housing sector to its advantage.

Timberland REIT (real estate investment trust) Weyerhaeuser (WY) reported upbeat earnings results for 2Q17, backed by higher sales and prudent cost management.

The growing economy has helped REITs including Weyerhaeuser (WY), Rayonier (RYN), Resolute Forests Products (RFP), and International Paper (IP) reap higher profits.

Timberland REITs (real estate investment trusts) in the US don’t seem to be in doubt about their continued growth momentum in the near future.

In this article, we’ll look into the rating analysts have given Boston Properties and also compare these ratings with those of the company’s close peers.

Boston Properties’ (BXP) valuation multiple can help us understand its expected performance for the rest of the year.

In order to qualify as REITs (real estate investment trusts), companies usually have to pay 90% of their profits (excluding capital gains) as dividends.

REITs depend on equity and debt for their working capital.

Although it is a common belief that high interest rates are usually bad for REITs like Boston Properties (BXP), Simon Property (SPG), Prologis (PLD), and Vornado Realty Trust (VNO), we find that REITs have continued in their growth trajectory in the past few months.

REITs have flourished for a considerable period in a record-low-interest-rate environment because they depend on debt and equity for their working capital.

BXP leased properties with a total area of 926,000 square feet in 2Q17.

Boston Property (BXP) has strong business momentum and has been maintaining a decent growth trajectory for the past few years.

Boston Properties raised its EPS (earnings per share) outlook for 2017 to a range of $2.72 to $2.77 per share.

The growing economy has acted as a boon to REITs, and with the help of their strategic initiatives, these REITs have been able to take advantage of the opportunity and report higher revenue and profits.

Boston Properties’ recent upbeat results came on the back of higher leasing activity as well as strong occupancy levels, which led to revenue growth.

Extra Space Storage’s (EXR) analyst target price is $81.13, up 7% from its current price level.

Public Storage (PSA) trades at an EV-to-EBITDA multiple of ~21.5x.

CubeSmart issued two notes of $50.0 million each, carrying interest of 4.4% and 4.0% and maturity dates of 2023 and 2025, respectively.

During 1H17, CubeSmart acquired two properties located in Maryland and California worth $21.9 million.

Although Public Storage did not provide any guidance for net operating income expected during fiscal 2017, analysts expect the company to report flat YoY NOI of ~$2.0 billion during 2Q17.

Self-storage REITs are experiencing solid growth in income and revenues in 2017. In this series, we’ll analyze the 2Q17 results for Public Storage (PSA), Extra Space Storage (EXR), and CubeSmart (CUBE).

Prologis (PLD) has been assigned a target price of $62.75, which is 0.8% higher than its current price level.

Real estate investment trusts have to distribute ~90% of their profits to investors in order to qualify as an REIT.

Industrial REITs (real estate investment trusts) fund their development and redevelopment properties through debt.

Industrial REITs (real estate investment trusts) tend to carry on many development and redevelopment projects simultaneously in order to maintain leadership.

Industrial REITs (real estate investment trusts) appear to have a bright future backed by a growing economy and industrial growth.

Industrial REITs (real estate investment trusts) reported robust top-line and bottom-line results in 2Q17 backed by industrial growth,

Industrial REITs (real estate investment trusts) are currently experiencing a boom, and many investors and analysts anticipate future growth.

Healthcare Trust of America (HTA) is the most premium among our top three healthcare REITs in terms of price-to-FFO multiple.

REITs are required to pay 90.0% of their profits to shareholders in the form of share buybacks or dividends.

Welltower spent $292.0 million on development and expansion in 2Q17. Of that, $110.0 million was spent on acquisitions.

Healthcare REITs fund their working capital through debt and equity. So it’s important to optimize their spending in order to maximize income.

Strong performance in skilled nursing facilities prompted Welltower management to increase its same-store net operating income guidance for fiscal 2017.

Healthcare REITs have positioned their properties in premium locations where there’s high income growth.

Healthcare REITs that own senior care facilities, hospitals, and nursing homes are seeing growth. With the aging population rising, the need for critical healthcare facilities is also rising.

The wireless tower owners’ expected performance in fiscal 2017 is reflected in the analysts’ ratings for the companies.

In this series, we’ll analyze the 2Q17 results of American Tower (AMT), SBAC Communications (SBAC), and Crown Castle International (CCI).

Residential REITs undertook various development and expansionary activities in order to maintain their leadership in the sector.

The residential REIT sector is on the threshold of a transition period and the performance of these stocks depends a lot on the macroeconomic as well as industrial changes taking place currently.

GGP’s (GGP) debt-to-equity was 1.55x for 2Q17, which was higher than the industrial mean of 1.07x. As of 2Q17, GGP had $2.0 billion of liquidity.

Simon Property Group (SPG) had 25 redevelopment expansion projects under construction as of 2Q17.

When we consider the top line performance of commercial REITs, we find that they have performed decently during the second quarter.

Price-to-funds from operations multiple AvalonBay Communities’ (AVB) performance in 2Q17 can be best evaluated by looking at its price-to-FFO (funds from operations) multiple. The multiple, widely used for REITs, gives an idea of how much an investor pays for a particular stock per unit of its profit. The multiple, which has the same implications as the price-to-earnings […]

Performance in 2Q17 AvalonBay Communities (AVB) has undertaken several development, redevelopment, and expansion projects to maintain its share in the market. It invested $400 million in new developments during the quarter. REITs such as UDR (UDR), Essex Property Trust (ESS), and Equity Residential (EQR) fund these activities with the help of debt and equity. Therefore, […]

Income generated in 2Q17 AvalonBay Communities (AVB) reported NOI (net operating income) of $367.1 million, compared with $339.6 million in 2Q16. The Northern California region reported the highest NOI of $64.6 million, followed by the New York metropolitan area, which reported NOI of $61.5 million. Development and redevelopment communities reported NOI growth of $40.1 million, […]

Wide geographical diversity AvalonBay Communities (AVB) has its assets well placed in high-demand Class A cities. These cities have soaring job growth, a high barrier to entry for competitors, and proximity to premium infrastructure. REIT peers UDR (UDR), Equity Residential (EQR), and Essex Property Trust (ESS) are repositioning their properties to Class A cities and […]

Demographic shift American demographics are shifting towards Class A cities with high-income growth and demand for residential apartments. These cities offer job prospects and proximity to offices, schools, and other necessities for premium social living. Although these cities also have high barriers to entry, more residential apartment owners are repositioning their properties in these areas. […]

Robust 2Q17 driven by rent growth AvalonBay Communities’ (AVB) total revenue of $530.5 million marginally surpassed Wall Street estimates by 0.3%. However, revenue rose by almost 6% from the year prior. Upbeat top-line growth reflected growth in development communities and stabilized operating communities. Same-store revenue rose 2.5% year-over-year. Including revenue from redeveloped communities, same-store revenue […]

Robust 2Q17 results AvalonBay Communities’ (AVB) top and bottom lines exceeded expectations, backed by higher net operating income growth of 8.1%.   Factors affecting profit during 2Q17 Higher occupancy and rent growth in development communities and stabilized operating communities led to upbeat results during the quarter. Higher funds from operations expected for 3Q17 AvalonBay expects […]

AvalonBay Communities (AVB) reported core FFO (funds from operations) of $2.09 per share, in line with Wall Street estimates.

GGP’s estimated price-to-FFO multiple for fiscal 2018 is 14.2x, which is at a premium compared to its peers.

In 2Q17, GGP (GGP) paid $17.5 million in dividends to its shareholders. That was higher than $13.3 million paid a year ago.

GGP maintained a debt-to-equity ratio of 1.55x for 2Q17. That was higher than the industrial mean of 1.07x.

GGP has redeveloped its vacant spaces for non-retail uses such as restaurants, entertainment zones, fitness centers, and grocery stores.

In 2Q17, GGP (GGP) reported NOI (net operating income) of $551.0 million, which came in higher than the previous year at $554.0 million.

GGP’s (GGP) minimum rent fell by $17.0 million in 2Q17, mainly because of dilution resulting from the sale of an interest in the Fashion Show Mall in Las Vegas n 2016.

GGP’s minimum rent fell 3.9% to $349.2 million, and tenant recoveries fell 4.6% to $161.9 million. Overage rent fell 25.0% to $3.3 million.

GGP (GGP) reported funds from operations (or FFO) of $0.35 per share, which was in line with Wall Street estimates. Adjusted FFO remained flat year-over-year.

Vornado’s recent development and redevelopment activities have made investors optimistic about the stock.

During 2Q17, Vornado Realty Trust (VNO) reported higher year-over-year top-line and bottom-line results backed by growth in rent and occupancy level.

Vornado Realty Trust reported adjusted FFO (funds from operation) of $1.35 per share, which beat Wall Street estimates of $1.20 per share.

Vornado Trust’s (VNO) top-line and bottom-line results improved year-over-year backed by higher rent growth and lower operational costs.

Vornado Realty Trust (VNO) reported decent results in 2Q17. Its top line and bottom line surpassed results from 2Q16 backed by higher rent and new lease activities.

Vornado Realty Trust (VNO) reported higher year-over-year top-line and bottom-line results during 2Q17 backed by higher rent growth, lower costs, and new leases during the quarter.

VNO posted rental revenue of $626 million in 2Q17, missing Wall Street’s estimates of $633.2 million.

Vornado Realty Trust (VNO) reported core funds from operation (or FFO) of $1.35 per share in 2Q17, which surpassed Wall Street estimates of $1.20 per share.

Welltower’s current price-to-FFO multiple is 17.34x. It had higher-than-expected results in 2Q17 and has an optimistic outlook for fiscal 2017.

Wellstone’s debt-to-equity ratio stood at 0.81x for 2Q17. That was lower than the industry mean of 1.07x.

On June 30, 2017, Welltower (HCN) announced a quarterly cash dividend of $0.87. The dividend is scheduled to be paid on August 21, 2017.

Higher same-store NOI (net operating income) and a strong demand for premium senior housing facilities drove Welltower’s profits during the quarter.

AMT’s current price-to-FFO multiple stands at ~22.1x. After 2Q17, American Tower offers a next-12-month dividend yield of 1.9%.

In 2Q17, American Tower (AMT) topped its 2Q16 results on higher organic tenant billing and prudent cost controls.

In 2Q17, American Tower distributed cash worth $275 million among its common stockholders and paid preferred stock dividends totaling $27 million.

American Tower’s (AMT) 2Q17 EBITDA grew 17.5% to $1.02 billion. These results surpassed the analysts’ expectations of $1 billion.

American Tower’s (AMT) total deployment consisted of $79 million for acquisitions and over $400 million for stock repurchases.

For 2Q17, American Tower (AMT) has reported robust double-digit revenue growth of 15.3%, backed primarily by higher tenant billing growth.

For fiscal 2017, American Tower expects to report property revenues that would be 14% higher on a year-over-year basis, or by $25 million.

For 2Q17, American Tower (AMT) reported adjusted funds from operation of $1.58 per share, meeting Wall Street estimates and topping 2Q16 by 18.8%.

During 2Q17, Equity Residential (EQR) reported higher-than-expected top-line and bottom-line results backed by robust rent growth and occupancy levels.

Equity Residential’s (EQR) top line in 2Q17 surpassed both the year-ago results as well as management’s expectations backed by rent growth.

Analysts assigned VNO a mean price target of $89.52, 13.8% higher than its current price level.

VNO’s current price-to-FFO multiple is 17.77x. The company has been able to return value to its shareholders consistently in the form of dividends and share repurchases.

Although Vornado Realty Trust (VNO) may witness lower margins during a higher interest rate environment, it may see significant growth in the near future.

Wall Street expects Vornado Realty Trust (VNO) to post flat year-over-year top-line and bottom-line results in 2Q17.

Vornado Realty Trust (VNO) is scheduled to report its 2Q17 earnings on July 31, 2017.

Wall Street analysts expect Vornado Realty Trust (VNO) to report net operating income of $338.1 million in 2Q17.

Analysts expect Vornado Realty Trust (VNO) to report revenues of $622.3 million for 2Q17 when it releases its earnings on July 31, 2017.

Vornado Realty Trust (VNO) is scheduled to report its 2Q17 earnings on July 31, 2017.

Analysts have assigned PSA a mean price target of $217.67, which is 4.9% higher than its current price level.

Public Storage has consistently been able to return capital value as well as shareholder returns in the form of dividends and share buybacks.

Public Storage (PSA) is expected to witness a higher cost of debt in 2Q17, mainly due to the Fed’s rate hikes in 2017.

Public Storage (PSA) is expected to post flat top-line and bottom-line results in 2Q17.