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Realty Income (O) Q2 AFFO Beats Estimates, Revenues Rise Y/Y
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Realty Income Corporation’s (O - Free Report) second-quarter 2024 adjusted funds from operations (AFFO) per share of $1.06 outpaced the Zacks Consensus Estimate of $1.05. The reported figure also compared favorably with the prior-year quarter’s $1.00 per share.
Results display better-than-anticipated top-line growth. The company benefited from expansionary effects and a healthy pipeline of opportunities globally. Although the portfolio occupancy increased sequentially, it declined year over year, affecting the results to some extent.
Total revenues were $1.34 billion, which outpaced the Zacks Consensus Estimate of $1.31 billion. The top line rose 31.4% year over year.
Quarter in Detail
In the second quarter, same-store rental revenues of $1 billion from 13,602 properties under lease witnessed a rise of 0.2% from the prior-year period.
The portfolio occupancy of 98.8% as of Jun 30, 2024, was up 20 basis points (bps) sequentially and shrunk 20 bps year over year. In the reported quarter, the company achieved a rent recapture rate of 105.7% on re-leasing activity.
In the reported quarter, O invested $805.8 million in 120 properties and properties under development or expansion.
Balance Sheet
Realty Income exited the second quarter of 2024 with $3.8 billion of liquidity. This comprised cash and cash equivalents of $44.8 million, unsettled At-The-Market forward equity of $247.8 million, and $3.1 billion of availability under its unsecured revolving credit facility and after deducting $302.2 million in commercial paper borrowings.
Net debt to annualized pro-forma adjusted EBITDAre was 5.3X.
2024 Guidance
Realty Income kept its guidance for 2024 unrevised.
Management projects 2024 AFFO per share of $4.15-$4.21. The Zacks Consensus Estimate is pegged at $4.21.
Full-year projections assume same-store rent growth of approximately 1% and occupancy of more than 98%. O expects a full-year investment volume of approximately $3 billion.
Federal Realty Investment Trust’s (FRT - Free Report) second-quarter 2024 FFO per share of $1.69 surpassed the Zacks Consensus Estimate of $1.68. The figure marked a rise of 1.2% from the year-ago quarter’s tally of $1.67.
Results reflected a healthy leasing activity and better-than-expected growth in revenues. The retail REIT also tightened and raised its guidance for 2024 FFO per share and announced a hike in dividends.
Kimco Realty Corp. (KIM - Free Report) reported a second-quarter 2024 FFO per share of 41 cents, which beat the Zacks Consensus Estimate of 40 cents. The reported figure grew 5.1% from the year-ago quarter’s tally.
Results reflected growth in revenues on a year-over-year basis. However, a rise in interest expenses acted as a dampener.
Note: Anything related to earnings presented in this write-up represents FFO, a widely used metric to gauge the performance of REITs.
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Realty Income (O) Q2 AFFO Beats Estimates, Revenues Rise Y/Y
Realty Income Corporation’s (O - Free Report) second-quarter 2024 adjusted funds from operations (AFFO) per share of $1.06 outpaced the Zacks Consensus Estimate of $1.05. The reported figure also compared favorably with the prior-year quarter’s $1.00 per share.
Results display better-than-anticipated top-line growth. The company benefited from expansionary effects and a healthy pipeline of opportunities globally. Although the portfolio occupancy increased sequentially, it declined year over year, affecting the results to some extent.
Total revenues were $1.34 billion, which outpaced the Zacks Consensus Estimate of $1.31 billion. The top line rose 31.4% year over year.
Quarter in Detail
In the second quarter, same-store rental revenues of $1 billion from 13,602 properties under lease witnessed a rise of 0.2% from the prior-year period.
The portfolio occupancy of 98.8% as of Jun 30, 2024, was up 20 basis points (bps) sequentially and shrunk 20 bps year over year. In the reported quarter, the company achieved a rent recapture rate of 105.7% on re-leasing activity.
In the reported quarter, O invested $805.8 million in 120 properties and properties under development or expansion.
Balance Sheet
Realty Income exited the second quarter of 2024 with $3.8 billion of liquidity. This comprised cash and cash equivalents of $44.8 million, unsettled At-The-Market forward equity of $247.8 million, and $3.1 billion of availability under its unsecured revolving credit facility and after deducting $302.2 million in commercial paper borrowings.
Net debt to annualized pro-forma adjusted EBITDAre was 5.3X.
2024 Guidance
Realty Income kept its guidance for 2024 unrevised.
Management projects 2024 AFFO per share of $4.15-$4.21. The Zacks Consensus Estimate is pegged at $4.21.
Full-year projections assume same-store rent growth of approximately 1% and occupancy of more than 98%. O expects a full-year investment volume of approximately $3 billion.
Realty Income currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Realty Income Corporation Price, Consensus and EPS Surprise
Realty Income Corporation price-consensus-eps-surprise-chart | Realty Income Corporation Quote
Performance of Other Retail REITs
Federal Realty Investment Trust’s (FRT - Free Report) second-quarter 2024 FFO per share of $1.69 surpassed the Zacks Consensus Estimate of $1.68. The figure marked a rise of 1.2% from the year-ago quarter’s tally of $1.67.
Results reflected a healthy leasing activity and better-than-expected growth in revenues. The retail REIT also tightened and raised its guidance for 2024 FFO per share and announced a hike in dividends.
Kimco Realty Corp. (KIM - Free Report) reported a second-quarter 2024 FFO per share of 41 cents, which beat the Zacks Consensus Estimate of 40 cents. The reported figure grew 5.1% from the year-ago quarter’s tally.
Results reflected growth in revenues on a year-over-year basis. However, a rise in interest expenses acted as a dampener.
Note: Anything related to earnings presented in this write-up represents FFO, a widely used metric to gauge the performance of REITs.