Federal Realty's (FRT) Q3 FFO & Revenues Beat, View Raised
Federal Realty Investment Trust’s FRT third-quarter 2022 funds from operations (FFO) per share of $1.59 surpassed the Zacks Consensus Estimate of $1.54. The figure grew 5.3% from the year-ago quarter’s $1.51.
Results reflect healthy leasing activity that aided FRT’s third-quarter performance. The top line grew year over year. This retail REIT raised its guidance for 2022 FFO per share.
Quarterly revenues of $273.5 million topped the consensus mark of $262.5 million and improved 10.6% from the year-ago quarter’s tally. For the third quarter, FRT generated comparable property operating income (POI) growth of 3.7%.
Quarter in Detail
During the reported quarter, Federal Realty signed 126 leases for 584,949 square feet of retail space. On a comparable space basis, the company signed 119 leases for 562,859 square feet of space at an average rent of $34.57 per square foot. This denotes cash-basis rollover growth of 3%, and 13% on a straight-line basis.
As of Sep 30, 2022, FRT’s portfolio was 92.1% occupied, denoting a quarter-over-quarter expansion of 10 basis points (bps) and 190 bps year over year. As of the same date, the portfolio was 94.3% leased, rising 150 bps year over year. The company maintained a 220 bps spread between leased and occupied percentages as of the third-quarter end.
Federal Realty also experienced continued strong small shop leasing, ending the quarter at 89.9% leased. This reflects an increase of 380 bps year over year.
In September, FRT disposed of two non-core assets, namely Towson Residential (including a retail pad) and Rockville Town Square, for a combined total sales price of $67 million.
Balance Sheet Position
Federal Realty exited the third quarter with cash and cash equivalents of $146.2 million, down from $176.6 million recorded as of Jun 30, 2022.
During the reported quarter, FRT amended its revolving credit facility and increased the borrowing capacity from $1.0 billion to $1.25 billion. The maturity date for the same was extended to Apr 5, 2027, with the option to prolong it by two successive terms of six months each.
2022 Guidance Up
For 2022, FRT raised its guidance for FFO per shar
It now estimates the same to lie in the range of $6.27-$6.32, up from $6.10-$6.25 guided earlier. The Zacks Consensus Estimate for the same is currently pegged at $6.21.
Dividend Update
Concurrent with the third-quarter earnings release, Federal Realty announced its regular quarterly cash dividend of $1.08 per share. This indicates an annual rate of $4.32 per share. The dividend will be paid out on Jan 17 to shareholders on record as of Jan 3, 2022.
Federal Realty currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Federal Realty Investment Trust Price, Consensus and EPS Surprise
Federal Realty Investment Trust price-consensus-eps-surprise-chart | Federal Realty Investment Trust Quote
Performance of Other Retail REITs
Kimco Realty Corp.’s KIM third-quarter 2022 FFO per share came in at 41 cents, surpassing the Zacks Consensus Estimate of 39 cents. The figure grew 28.1% from the year-ago quarter’s 32 cents.
Results reflect year-over-year growth in the top line. The rise in occupancy levels and rental rate growth aided Kimco’s performance. It raised the 2022 FFO per share outlook.
Simon Property Group, Inc.’s SPG third-quarter 2022 comparable FFO per share of $2.97 exceeded the Zacks Consensus Estimate of $2.93. The figure compares favorably with the year-ago quarter’s $2.92.
SPG’s results reflect healthy operating performance and growth in occupancy levels. Based on the quarterly results, this retail REIT behemoth raised the 2022 FFO per share outlook and announced a hike in the quarterly dividend.
SITE Centers Corp. SITC reported third-quarter 2022 operating FFO (OFFO) per share of 29 cents, beating the Zacks Consensus Estimate by a cent. The figure was in line with the prior-year quarter’s FFO per share.
SITC’s results reflect healthy leasing activity and a year-over-year improvement in annualized base rent.
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.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Simon Property Group, Inc. (SPG) : Free Stock Analysis Report
Kimco Realty Corporation (KIM) : Free Stock Analysis Report
Federal Realty Investment Trust (FRT) : Free Stock Analysis Report
SITE CENTERS CORP. (SITC) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
