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Federal Realty (FRT) Beats on Q2 FFO, Ups '21 View, Hikes Dividend
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Federal Realty Investment Trust’s (FRT - Free Report) second-quarter 2021 funds from operations (FFO) per share of $1.41 handily surpassed the Zacks Consensus Estimate of $1.16. This also compares favorably with the year-ago quarter tally of 77 cents.
Results reflect better-than-anticipated revenues. The retail REIT has also raised its guidance for 2021 and 2022 FFO per share, and as well as the dividend.
Quarterly revenues of $231.6 million topped the consensus mark of $219.9 million and also exceeded the year-ago quarter tally by 31.4%.
According to Donald C. Wood, the company’s chief executive officer,"Our all-time high leasing volumes with best-in-class, relevant tenants coupled with our new acquisitions and existing development pipeline set our company and our assets up to be more dominant, more relevant and therefore more valuable in a post-COVID world."
It has also collected about 94% of total second-quarter 2021 billed recurring rents as of Jul 28, 2021.
Quarter in Details
During the reported quarter, Federal Realty signed 133 leases for 576,782 square feet of retail space. On a comparable space basis, the company signed 124 leases for 558,490 square feet of space at an average rent of $37.34 per square foot. This denotes cash-basis rollover growth of 8%, 18% on a straight-line basis.
As of Jun 30, the REIT’s overall portfolio was 92.7% leased, denoting a sequential expansion of 90 basis points.The company reported a 310-basis-point spread between leased and occupied.
During the second quarter, Federal Realty acquired 4 assets, aggregating 1.76 million square feet on 125 acres of land, at a gross value of $407 million, of which Federal owns an average 80% interest.
Balance Sheet
Federal Realty exited second-quarter 2021 with cash and cash equivalents of $304.3 million, down from the $798.3 million recorded at the end of 2020. Along with undrawn availability under its $1-billion revolving credit facility, the company’s liquidity amounted to $1.3 billion.
Outlook
Federal Realty raised its guidance for both 2021 and 2022. For 2021, the company now projects FFO per share of $5.05-$5.15. This is ahead of the Zacks Consensus Estimate of $4.73.
For 2022, the REIT now estimates FFO per share of $5.30 to $5.50. The Zacks Consensus Estimate for the same is currently pinned at $5.27.
Dividend Update
Concurrent with the second-quarter earnings release, Federal Realty announced a hike in its regular quarterly cash dividend to $1.07 per share from the $1.06 per share paid earlier. The new dividend indicates an annual rate of $4.28 per share. The dividend will be paid out on Oct 15, to shareholders of record as of Sep 22, 2021. The latest hike marks the 54th consecutive year of common dividend increases by the company.
Simon Property Group, Inc.’s (SPG - Free Report) second-quarter 2021 adjusted FFO per share of $2.92 handily exceeded the Zacks Consensus Estimate of $2.37. This performance was backed by better-than-expected top-line growth. The retail REIT behemoth also raised the 2021 FFO per share outlook based on its results in the year so far and expectations for the rest of 2021. It also announced a hike in its quarterly dividend.
Kimco Realty Corp.’s (KIM - Free Report) NAREIT FFO per share came in at 34 cents, topping the Zacks Consensus Estimate of 31 cents for the April-June period. This also compared favorably with the year-ago quarter tally of 24 cents. Results displayed better-than-anticipated revenue numbers. Moreover, the retail REIT raised the guidance for 2021 on improved outlook.
Realty Income Corporation’s (O - Free Report) second-quarter 2021 adjusted AFFO per share of 88 cents came in line with the Zacks Consensus Estimate. The reported figure also compares favorably with the prior-year quarter’s 86 cents. Results reflect better-than-expected improvement in revenues. The retail REIT also raised its 2021 adjusted FFO per share guidance and increased the 2021 acquisitions volume projections to $4.5 billion.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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Federal Realty (FRT) Beats on Q2 FFO, Ups '21 View, Hikes Dividend
Federal Realty Investment Trust’s (FRT - Free Report) second-quarter 2021 funds from operations (FFO) per share of $1.41 handily surpassed the Zacks Consensus Estimate of $1.16. This also compares favorably with the year-ago quarter tally of 77 cents.
Results reflect better-than-anticipated revenues. The retail REIT has also raised its guidance for 2021 and 2022 FFO per share, and as well as the dividend.
Quarterly revenues of $231.6 million topped the consensus mark of $219.9 million and also exceeded the year-ago quarter tally by 31.4%.
According to Donald C. Wood, the company’s chief executive officer,"Our all-time high leasing volumes with best-in-class, relevant tenants coupled with our new acquisitions and existing development pipeline set our company and our assets up to be more dominant, more relevant and therefore more valuable in a post-COVID world."
It has also collected about 94% of total second-quarter 2021 billed recurring rents as of Jul 28, 2021.
Quarter in Details
During the reported quarter, Federal Realty signed 133 leases for 576,782 square feet of retail space. On a comparable space basis, the company signed 124 leases for 558,490 square feet of space at an average rent of $37.34 per square foot. This denotes cash-basis rollover growth of 8%, 18% on a straight-line basis.
As of Jun 30, the REIT’s overall portfolio was 92.7% leased, denoting a sequential expansion of 90 basis points.The company reported a 310-basis-point spread between leased and occupied.
During the second quarter, Federal Realty acquired 4 assets, aggregating 1.76 million square feet on 125 acres of land, at a gross value of $407 million, of which Federal owns an average 80% interest.
Balance Sheet
Federal Realty exited second-quarter 2021 with cash and cash equivalents of $304.3 million, down from the $798.3 million recorded at the end of 2020. Along with undrawn availability under its $1-billion revolving credit facility, the company’s liquidity amounted to $1.3 billion.
Outlook
Federal Realty raised its guidance for both 2021 and 2022. For 2021, the company now projects FFO per share of $5.05-$5.15. This is ahead of the Zacks Consensus Estimate of $4.73.
For 2022, the REIT now estimates FFO per share of $5.30 to $5.50. The Zacks Consensus Estimate for the same is currently pinned at $5.27.
Dividend Update
Concurrent with the second-quarter earnings release, Federal Realty announced a hike in its regular quarterly cash dividend to $1.07 per share from the $1.06 per share paid earlier. The new dividend indicates an annual rate of $4.28 per share. The dividend will be paid out on Oct 15, to shareholders of record as of Sep 22, 2021. The latest hike marks the 54th consecutive year of common dividend increases by the company.
Federal Realty currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Federal Realty Investment Trust Price, Consensus and EPS Surprise
Federal Realty Investment Trust price-consensus-eps-surprise-chart | Federal Realty Investment Trust Quote
Performance of Other Retail REITs
Simon Property Group, Inc.’s (SPG - Free Report) second-quarter 2021 adjusted FFO per share of $2.92 handily exceeded the Zacks Consensus Estimate of $2.37. This performance was backed by better-than-expected top-line growth. The retail REIT behemoth also raised the 2021 FFO per share outlook based on its results in the year so far and expectations for the rest of 2021. It also announced a hike in its quarterly dividend.
Kimco Realty Corp.’s (KIM - Free Report) NAREIT FFO per share came in at 34 cents, topping the Zacks Consensus Estimate of 31 cents for the April-June period. This also compared favorably with the year-ago quarter tally of 24 cents. Results displayed better-than-anticipated revenue numbers. Moreover, the retail REIT raised the guidance for 2021 on improved outlook.
Realty Income Corporation’s (O - Free Report) second-quarter 2021 adjusted AFFO per share of 88 cents came in line with the Zacks Consensus Estimate. The reported figure also compares favorably with the prior-year quarter’s 86 cents. Results reflect better-than-expected improvement in revenues. The retail REIT also raised its 2021 adjusted FFO per share guidance and increased the 2021 acquisitions volume projections to $4.5 billion.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.