We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
What's in the Offing for W.P. Carey (WPC) in Q3 Earnings?
Read MoreHide Full Article
W. P. Carey Inc. (WPC - Free Report) is set to report third-quarter 2023 results on Nov 3, before the opening bell. While revenues are expected to reflect year-over-year growth, funds from operations (FFO) per share might exhibit a decline.
In the last reported quarter, this New York-based net lease real estate investment trust (REIT) delivered a surprise of 2.26% in terms of adjusted FFO per share.
Over the trailing four quarters, W. P. Carey’s adjusted FFO per share surpassed the Zacks Consensus Estimate on two occasions, met once and missed in the remaining one, with the average beat being 1.73%. The graph below depicts the surprise history of the company:
W. P. Carey owns a well-diversified portfolio of high-quality, operationally critical commercial real estate. It focuses on investing in high-quality single-tenant, industrial, warehouse and retail properties, mainly in the United States and Northern and Western Europe. The continued strength in demand in these asset categories during the quarter is expected to have led to healthy leasing activity and a gain in occupancy rates.
The company leases its properties to tenants via long-term net leases with built-in rent escalators. This shifts most of the operating expenses, taxes and insurance costs to the tenant, paving the way for stable rental revenue generation and boosting top-line growth.
The Zacks Consensus Estimate for third-quarter 2023 revenues is pegged at $459.5 million, indicating a 19.8% increase from the prior-year quarter’s reported figure.
Further, we expect WPC to have continued with its accretive investment opportunities backed by a robust balance sheet position.
However, the choppiness in certain real estate categories, especially the office real estate market, is expected to have cast a pall on the company’s quarterly performance to some extent. Also, higher interest expenses are likely to have been a spoilsport.
The company’s activities during the to-be-reported quarter were inadequate to secure analysts’ confidence. The Zacks Consensus Estimate for quarterly FFO per share has been revised 2.9% downward over the past month to $1.32. Moreover, the figure suggests a fall of 2.9% year over year.
Q3 Developments
W. P. Carey’s board of directors has collectively approved a plan to exit the office assets within its portfolio. Given that the United States office real estate market environment has been choppy for quite some time now, the company’s decision seems prudent.
This exit will be carried out by spinning off 59 office properties into a separate publicly-traded REIT — Net Lease Office Properties — and an asset sale program will be arranged for the remaining 87 office properties.
The move is expected to benefit the company in terms of improving its overall portfolio quality and key portfolio metrics, including an increased weighting to warehouse and industrial assets. WPC anticipates achieving an improved cost of capital, enhancing its growth profile.
Further, the spinoff and asset sale are likely to result in increased quality and stability of the company’s earnings and cash flows through better end-of-lease outcomes while maintaining a strong, scalable, investment-grade balance sheet.
Earnings Whispers
Our proven model does not conclusively predict a surprise in terms of FFO per share for W.P. Carey this season. The combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or higher — increases the odds of a beat. However, that is not the case here.
Earnings ESP: WPC has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Prologis, Inc. (PLD - Free Report) reported third-quarter 2023 core FFO per share of $1.30, beating the Zacks Consensus Estimate of $1.26. The figure, however, declined 24.9% from the year-ago quarter.
The results of this industrial REIT reflected healthy rent growth. However, lower occupancy and higher interest expenses were undermining factors. PLD also raised the midpoint of its 2023 core FFO per share guidance by a cent.
American Tower Corporation (AMT - Free Report) reported AFFO per share, attributable to AMT common stockholders, of $2.58, which beat the Zacks Consensus Estimate of $2.35 and climbed 9.3% year over year.
Results reflected better-than-anticipated revenues, aided by revenue growth across its Property segment. American Tower recorded healthy year-over-year organic tenant billings growth of 6.3% and total tenant billings growth of 7.3%. It also raised its outlook for 2023.
Equinix Inc.’s (EQIX - Free Report) third-quarter 2023 AFFO per share of $8.19 surpassed the Zacks Consensus Estimate of $7.79. The figure improved nearly 6% from the prior-year quarter.
EQIX’s results reflected steady growth in colocation and inter-connection revenues as enterprises and service providers look to integrate artificial intelligence into their strategies and offerings. During the quarter, Equinix’s total interconnections reached 460,500, rising 1% sequentially and 4% year over year. The company also raised its AFFO per share guidance for 2023.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
What's in the Offing for W.P. Carey (WPC) in Q3 Earnings?
W. P. Carey Inc. (WPC - Free Report) is set to report third-quarter 2023 results on Nov 3, before the opening bell. While revenues are expected to reflect year-over-year growth, funds from operations (FFO) per share might exhibit a decline.
In the last reported quarter, this New York-based net lease real estate investment trust (REIT) delivered a surprise of 2.26% in terms of adjusted FFO per share.
Over the trailing four quarters, W. P. Carey’s adjusted FFO per share surpassed the Zacks Consensus Estimate on two occasions, met once and missed in the remaining one, with the average beat being 1.73%. The graph below depicts the surprise history of the company:
W.P. Carey Inc. Price and EPS Surprise
W.P. Carey Inc. price-eps-surprise | W.P. Carey Inc. Quote
Factors to Note
W. P. Carey owns a well-diversified portfolio of high-quality, operationally critical commercial real estate. It focuses on investing in high-quality single-tenant, industrial, warehouse and retail properties, mainly in the United States and Northern and Western Europe. The continued strength in demand in these asset categories during the quarter is expected to have led to healthy leasing activity and a gain in occupancy rates.
The company leases its properties to tenants via long-term net leases with built-in rent escalators. This shifts most of the operating expenses, taxes and insurance costs to the tenant, paving the way for stable rental revenue generation and boosting top-line growth.
The Zacks Consensus Estimate for third-quarter 2023 revenues is pegged at $459.5 million, indicating a 19.8% increase from the prior-year quarter’s reported figure.
Further, we expect WPC to have continued with its accretive investment opportunities backed by a robust balance sheet position.
However, the choppiness in certain real estate categories, especially the office real estate market, is expected to have cast a pall on the company’s quarterly performance to some extent. Also, higher interest expenses are likely to have been a spoilsport.
The company’s activities during the to-be-reported quarter were inadequate to secure analysts’ confidence. The Zacks Consensus Estimate for quarterly FFO per share has been revised 2.9% downward over the past month to $1.32. Moreover, the figure suggests a fall of 2.9% year over year.
Q3 Developments
W. P. Carey’s board of directors has collectively approved a plan to exit the office assets within its portfolio. Given that the United States office real estate market environment has been choppy for quite some time now, the company’s decision seems prudent.
This exit will be carried out by spinning off 59 office properties into a separate publicly-traded REIT — Net Lease Office Properties — and an asset sale program will be arranged for the remaining 87 office properties.
The move is expected to benefit the company in terms of improving its overall portfolio quality and key portfolio metrics, including an increased weighting to warehouse and industrial assets. WPC anticipates achieving an improved cost of capital, enhancing its growth profile.
Further, the spinoff and asset sale are likely to result in increased quality and stability of the company’s earnings and cash flows through better end-of-lease outcomes while maintaining a strong, scalable, investment-grade balance sheet.
Earnings Whispers
Our proven model does not conclusively predict a surprise in terms of FFO per share for W.P. Carey this season. The combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or higher — increases the odds of a beat. However, that is not the case here.
Earnings ESP: WPC has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: WPC currently carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
Performance of Other REITs
Prologis, Inc. (PLD - Free Report) reported third-quarter 2023 core FFO per share of $1.30, beating the Zacks Consensus Estimate of $1.26. The figure, however, declined 24.9% from the year-ago quarter.
The results of this industrial REIT reflected healthy rent growth. However, lower occupancy and higher interest expenses were undermining factors. PLD also raised the midpoint of its 2023 core FFO per share guidance by a cent.
American Tower Corporation (AMT - Free Report) reported AFFO per share, attributable to AMT common stockholders, of $2.58, which beat the Zacks Consensus Estimate of $2.35 and climbed 9.3% year over year.
Results reflected better-than-anticipated revenues, aided by revenue growth across its Property segment. American Tower recorded healthy year-over-year organic tenant billings growth of 6.3% and total tenant billings growth of 7.3%. It also raised its outlook for 2023.
Equinix Inc.’s (EQIX - Free Report) third-quarter 2023 AFFO per share of $8.19 surpassed the Zacks Consensus Estimate of $7.79. The figure improved nearly 6% from the prior-year quarter.
EQIX’s results reflected steady growth in colocation and inter-connection revenues as enterprises and service providers look to integrate artificial intelligence into their strategies and offerings. During the quarter, Equinix’s total interconnections reached 460,500, rising 1% sequentially and 4% year over year. The company also raised its AFFO per share guidance for 2023.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.