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Kimco Secures A- Credit Rating With Stable Outlook from Fitch

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Kimco Realty (KIM - Free Report) recently announced that the retail real estate investment trust (REIT) secured an ‘A-’ credit rating with a stable outlook from Fitch Ratings. This achievement positions the company among only 12 publicly-listed U.S. REITs that hold a credit rating of ‘A-’ or higher.

Kimco's rating is a testament to the long-term stewardship of its proficient management teams and the effective oversight of its board, which have enabled the company to thrive through many commercial real estate cycles.

Its position at the higher end of the rating category is backed by the company’s extensive and geographically diversified portfolio located in attractive markets, along with its solid access to capital. Other significant factors that reflected the ratings include Kimco's robust and diverse tenant base, as well as its stable levels of leverage.

Kimco is well-poised to benefit from its portfolio of high-quality, open-air shopping centers, which are predominantly grocery-anchored, in the drivable first-ring suburbs within key major metropolitan Sunbelt and coastal markets. Its focus on developing mixed-use assets bodes well for long-term growth.

Moreover, Kimco maintains a healthy balance sheet position. It exited the second quarter of 2024 with $1.9 billion of immediate liquidity. Its consolidated weighted average debt maturity profile is 8.7 years. The Fitch rating marks its solid creditworthiness and will render it favorable access to the debt market. With a healthy financial footing, KIM is well-positioned to capitalize on long-term growth opportunities.

Last month, Kimco reported better-than-expected second-quarter 2024 results. It reported funds from operations (FFO) per share of 41 cents, surpassing the Zacks Consensus Estimate of 40 cents. The figure grew 5.1% from the year-ago quarter’s tally. Though Kimco reported growth in revenues, a rise in interest expenses acted as a dampener.

Shares of this Zacks Rank #3 (Hold) company have rallied 27.2% in the past three months, outperforming the industry's growth of 13.7%.

 

Zacks Investment Research
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Stocks to Consider

Some better-ranked stocks from the retail REIT sector are Brixmor Property Group (BRX - Free Report) and Tanger, Inc. (SKT - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Brixmor’s 2024 FFO per share is pinned at $2.13, suggesting year-over-year growth of 4.4%.

The Zacks Consensus Estimate for Tanger’s 2024 FFO per share stands at $2.09, indicating an increase of 6.6% from the year-ago reported figure.

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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