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UDR Inc. (UDR - Free Report) reported second-quarter 2024 funds from operations as adjusted (FFOA) per share of 62 cents, which surpassed the Zacks Consensus Estimate of 61 cents. On a year-over-year basis, FFOA per share climbed 1.6%.
Quarterly rental income was $413.3 million, which outpaced the Zacks Consensus Estimate of $412.9 million and came ahead of the year-ago quarter’s $403.1 million. Total revenues came in at $415.3 million. Rental income and total revenues rose 2.5% and 2.7%, respectively.
Results reflect an increase in revenues from same-store communities.UDR also raised its full-year 2024 guidance.
Per Tom Toomey, UDR’s chairman and CEO, “Supported by more robust pricing power than anticipated, the strength of our operating platform, and an innovative culture that continues to generate value-creating initiatives, we are raising full-year 2024 FFOA per diluted share and same-store growth guidance expectations to reflect our strong positioning in the marketplace.”
Inside the Headlines
In the reported quarter, same-store revenues (with concessions reflected on a straight-line basis) increased 2.5% year over year. Same-store expenses were up 3.7%. Consequently, the same-store net operating income (NOI) improved 2%.
For the same-store portfolio, UDR registered effective blended lease rate growth of 2.4% during the quarter. The residential REIT’s weighted average same-store physical occupancy of 96.8% decreased 20 basis points (bps) sequentially and increased 20 bps year over year. Our estimate was pegged at 96.9%.
However, property operating and maintenance expenses of $70.4 million rose 2.3% year over year. Our estimate was pegged at $71.3 million. Interest expenses climbed 6% to $47.8 million.
Portfolio Activity
During the quarter, the company developed a $134 million, 330-home apartment community in Tampa, FL.
At the end of the second quarter, UDR funded $483.8 million of its $484.7 million DCP commitments. The contractual weighted average return rate for these investments was 10%, and the weighted average remaining term was 2.4 years.
Balance Sheet Activity
As of Jun 30, 2024, UDR had $946.2 million of liquidity through a combination of cash and undrawn capacity on its credit facilities.
The total debt was $5.8 billion as of the same date, with $290.3 million, or 5.4% of total consolidated debt, maturing through 2025. In addition, net debt-to-EBITDAre was 5.7X in the second quarter.
UDR ended the quarter with a weighted average interest rate of 3.38% and a weighted average years to maturity of 5.2 years.
2024 Guidance
UDR expects third-quarter 2024 FFOA per share in the range of 61-63 cents. The Zacks Consensus Estimate for the same is currently pegged at 61 cents.
UDR raised certain full-year 2024 guidance ranges.
The company now expects 2024 FFOA per share in the range of $2.42-$2.50, up 2 cents at the midpoint from the prior guided range of $2.38-$2.50. The Zacks Consensus Estimate for the same is currently pegged at $2.45.
UDR’s guidance incorporated projections for growth of its same-store revenues in the range of 1-3%, up from the previously guided range of 0.0-3%. The company lowered the guidance for growth in its same-store expenses to 4-6% from the 4.25-6.25% guided earlier. It increased the guidance for growth in its same-store NOI to (0.25)%-1.75% from (1.75)%-1.75% guided earlier.
Equity Residential (EQR - Free Report) reported a second-quarter 2024 normalized FFO per share of 97 cents, which surpassed the Zacks Consensus Estimate of 96 cents. The rental income of $734.16 million also marginally beat the consensus mark of $734.14 million. On a year-over-year basis, the normalized FFO per share grew 3.2% from 94 cents, with rental income climbing 2.3%.
Results reflected decent same-store performances, backed by healthy demand, modest supply and a focus on expense efficiency. The company also raised its 2024 guidance. Currently, EQR carries a Zacks Rank of 2.
Essex Property Trust Inc. (ESS - Free Report) reported a second-quarter 2024 core FFO per share of $3.94, which beat the Zacks Consensus Estimate of $3.84. The figure also improved 4.5% from the year-ago quarter.Total revenues of $442.36 million outpaced the Zacks Consensus Estimate of $433.26 million. Revenues were up 6.3% year over year.
ESS’ quarterly results reflected favorable growth in same-property revenues and NOI. This residential REIT also raised its 2024 core FFO per share, same-store residential revenue and NOI growth outlook following the Q2 FFO beat. Currently, ESS carries a Zacks Rank of 2.
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.
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UDR Beats Q2 FFOA & Revenue Estimates, Ups 2024 Guidance
UDR Inc. (UDR - Free Report) reported second-quarter 2024 funds from operations as adjusted (FFOA) per share of 62 cents, which surpassed the Zacks Consensus Estimate of 61 cents. On a year-over-year basis, FFOA per share climbed 1.6%.
Quarterly rental income was $413.3 million, which outpaced the Zacks Consensus Estimate of $412.9 million and came ahead of the year-ago quarter’s $403.1 million. Total revenues came in at $415.3 million. Rental income and total revenues rose 2.5% and 2.7%, respectively.
Results reflect an increase in revenues from same-store communities.UDR also raised its full-year 2024 guidance.
Per Tom Toomey, UDR’s chairman and CEO, “Supported by more robust pricing power than anticipated, the strength of our operating platform, and an innovative culture that continues to generate value-creating initiatives, we are raising full-year 2024 FFOA per diluted share and same-store growth guidance expectations to reflect our strong positioning in the marketplace.”
Inside the Headlines
In the reported quarter, same-store revenues (with concessions reflected on a straight-line basis) increased 2.5% year over year. Same-store expenses were up 3.7%. Consequently, the same-store net operating income (NOI) improved 2%.
For the same-store portfolio, UDR registered effective blended lease rate growth of 2.4% during the quarter. The residential REIT’s weighted average same-store physical occupancy of 96.8% decreased 20 basis points (bps) sequentially and increased 20 bps year over year. Our estimate was pegged at 96.9%.
However, property operating and maintenance expenses of $70.4 million rose 2.3% year over year. Our estimate was pegged at $71.3 million. Interest expenses climbed 6% to $47.8 million.
Portfolio Activity
During the quarter, the company developed a $134 million, 330-home apartment community in Tampa, FL.
At the end of the second quarter, UDR funded $483.8 million of its $484.7 million DCP commitments. The contractual weighted average return rate for these investments was 10%, and the weighted average remaining term was 2.4 years.
Balance Sheet Activity
As of Jun 30, 2024, UDR had $946.2 million of liquidity through a combination of cash and undrawn capacity on its credit facilities.
The total debt was $5.8 billion as of the same date, with $290.3 million, or 5.4% of total consolidated debt, maturing through 2025. In addition, net debt-to-EBITDAre was 5.7X in the second quarter.
UDR ended the quarter with a weighted average interest rate of 3.38% and a weighted average years to maturity of 5.2 years.
2024 Guidance
UDR expects third-quarter 2024 FFOA per share in the range of 61-63 cents. The Zacks Consensus Estimate for the same is currently pegged at 61 cents.
UDR raised certain full-year 2024 guidance ranges.
The company now expects 2024 FFOA per share in the range of $2.42-$2.50, up 2 cents at the midpoint from the prior guided range of $2.38-$2.50. The Zacks Consensus Estimate for the same is currently pegged at $2.45.
UDR’s guidance incorporated projections for growth of its same-store revenues in the range of 1-3%, up from the previously guided range of 0.0-3%. The company lowered the guidance for growth in its same-store expenses to 4-6% from the 4.25-6.25% guided earlier. It increased the guidance for growth in its same-store NOI to (0.25)%-1.75% from (1.75)%-1.75% guided earlier.
Currently, UDR carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Performance of Other Residential REITs
Equity Residential (EQR - Free Report) reported a second-quarter 2024 normalized FFO per share of 97 cents, which surpassed the Zacks Consensus Estimate of 96 cents. The rental income of $734.16 million also marginally beat the consensus mark of $734.14 million. On a year-over-year basis, the normalized FFO per share grew 3.2% from 94 cents, with rental income climbing 2.3%.
Results reflected decent same-store performances, backed by healthy demand, modest supply and a focus on expense efficiency. The company also raised its 2024 guidance. Currently, EQR carries a Zacks Rank of 2.
Essex Property Trust Inc. (ESS - Free Report) reported a second-quarter 2024 core FFO per share of $3.94, which beat the Zacks Consensus Estimate of $3.84. The figure also improved 4.5% from the year-ago quarter.Total revenues of $442.36 million outpaced the Zacks Consensus Estimate of $433.26 million. Revenues were up 6.3% year over year.
ESS’ quarterly results reflected favorable growth in same-property revenues and NOI. This residential REIT also raised its 2024 core FFO per share, same-store residential revenue and NOI growth outlook following the Q2 FFO beat. Currently, ESS carries a Zacks Rank of 2.
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.