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HCP's FFO Beats Estimates in Q4, Revenues Lag Expectations

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Have you been eager to see how HCP Inc. (HCP - Free Report) performed in Q4 in comparison with the market expectations? Let’s quickly scan through the key facts from this Irvine, CA-based healthcare real estate investment trust’s (REIT) earnings release this morning:

A FFO Beat

HCP came out with funds from operations (FFO) as adjusted of 48 cents per share, beating the Zacks Consensus Estimate of 47 cents.

Results reflect a 1.2% increase in three-month same property portfolio (SPP) cash net operating income (NOI).

How Was the Earnings Surprise Trend?

HCP has a decent surprise history. Before posting a FFO beat in Q4, the company delivered a positive surprise in each of the trailing four quarters, as shown in the chart below. Overall, the company surpassed the Zacks Consensus Estimate by an average of 4.06% in the trailing four quarters.

HCP, Inc. Price and EPS Surprise
 

HCP, Inc. Price and EPS Surprise | HCP, Inc. Quote

Revenue Came In Lower Than Expected

HCP posted revenues of $443.3 million, which missed the Zacks Consensus Estimate of $456.2 million. It also compared unfavorably with the year-ago number of around $540.0 million.

Key Developments to Note

HCP completed the prior announced $228 million acquisition of the Hayden Research Campus in the Boston life science market.

HCP is involved in selling or transitioning 36 senior housing operating assets and 32 triple-net leased communities, which are presently operated by Brookdale.

Further, the company closed on a new $2.0 billion unsecured revolving credit facility.

HCP has provided its 2018 FFO as adjusted guidance range and expects it to be in the band of $1.77-$1.83 per share. The company expects 2018 SPP cash NOI growth in the range of 0.25- 1.75%.

What Zacks Rank Says

HCP currently has a Zacks Rank #5 (Strong Sell). However, since the latest earnings performance is yet to be reflected in the estimate revisions, the rank is subject to change.

(You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.)

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.

Check back later for our full write up on this HCP earnings report!

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