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Why Is Vornado Realty (VNO) Down 6% Since the Last Earnings Report?
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A month has gone by since the last earnings report for Vornado Realty Trust (VNO - Free Report) . Shares have lost about 6% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Vornado’s Q4 FFO Misses Estimates, Revenues Beat
Vornado reported fourth-quarter 2016 adjusted FFO per share of $1.13, missing the Zacks Consensus Estimate of $1.31. The figure also compared unfavorably with the fourth-quarter 2015 adjusted FFO per share tally of $1.26.
Results reflect a fall in occupancy in the Washington DC portfolio.
For the reported quarter, total revenue came in at $638.2 million, down 2% year over year. However, it surpassed the Zacks Consensus Estimate of $627 million.
FFO per share for full-year 2016 came in at $4.66 per share, down from the 2015 tally of $4.75. The Zacks Consensus Estimate for 2016 was $4.78.
Further, total revenue for full-year 2016 came in at $2.51 billion, almost same with both the Zacks Consensus Estimate and the 2015 figure.
Quarter in Detail
In the New York portfolio, Vornado leased 626,000 square feet of office space and 10,000 square feet of retail space during the fourth quarter. Further, the company leased 329,000 square feet of office space in the Washington DC portfolio.
At the quarter end, same-store occupancy in the New York portfolio was 96.5%, reflecting an expansion of 70 basis points (bps) sequentially and 10 bps year over year. However, same-store occupancy in the Washington DC portfolio was 90.5%, down 80 bps sequentially and 110 bps year over year.
Same-store earnings before interest, tax, depreciation and amortization for New York portfolio increased 7.8% from a year ago and for Washington DC, it rose 2.3%.
As of Dec 31, 2016, Vornado had $1.50 billion of cash and cash equivalents, down from $1.84 billion as of Dec 31, 2015.
Other Important Developments
On Oct 31, 2016, Vornado’s Board of Trustees approved the tax-free spin-off of the Washington, DC segment and signed an agreement to merge it with the business and certain select assets of The JBG Companies, a Washington, DC real estate company.
On Dec 19, 2016, the company closed the sale of its 20% interest in Fairfax Square to its joint venture partner for $15.5 million. Moreover, on Dec 21, 2016 Vornado announced the final disposition of its Skyline properties in Fairfax, VA.
On Dec 2, 2016, the company closed a $400 million refinancing of 350 Park Avenue, a 571,000 square foot Manhattan office building. The company realized net proceeds of approximately $111 million.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed a downward trend in fresh estimates. There has been one revision lower for the current quarter.
At this time, Vornado Realty's stock has a poor Growth Score of 'F', however its Momentum is doing a lot better with a 'B'. However, the stock was allocated a grade of 'D' on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'F'. If you aren't focused on one strategy, this score is the one you should be interested in.
The company's stock is suitable solely for momentum based on our styles scores.
Outlook
While estimates have been broadly trending downward for the stock, the magnitude of this revision looks promising. Notably, the stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.
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Why Is Vornado Realty (VNO) Down 6% Since the Last Earnings Report?
A month has gone by since the last earnings report for Vornado Realty Trust (VNO - Free Report) . Shares have lost about 6% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Vornado’s Q4 FFO Misses Estimates, Revenues Beat
Vornado reported fourth-quarter 2016 adjusted FFO per share of $1.13, missing the Zacks Consensus Estimate of $1.31. The figure also compared unfavorably with the fourth-quarter 2015 adjusted FFO per share tally of $1.26.
Results reflect a fall in occupancy in the Washington DC portfolio.
For the reported quarter, total revenue came in at $638.2 million, down 2% year over year. However, it surpassed the Zacks Consensus Estimate of $627 million.
FFO per share for full-year 2016 came in at $4.66 per share, down from the 2015 tally of $4.75. The Zacks Consensus Estimate for 2016 was $4.78.
Further, total revenue for full-year 2016 came in at $2.51 billion, almost same with both the Zacks Consensus Estimate and the 2015 figure.
Quarter in Detail
In the New York portfolio, Vornado leased 626,000 square feet of office space and 10,000 square feet of retail space during the fourth quarter. Further, the company leased 329,000 square feet of office space in the Washington DC portfolio.
At the quarter end, same-store occupancy in the New York portfolio was 96.5%, reflecting an expansion of 70 basis points (bps) sequentially and 10 bps year over year. However, same-store occupancy in the Washington DC portfolio was 90.5%, down 80 bps sequentially and 110 bps year over year.
Same-store earnings before interest, tax, depreciation and amortization for New York portfolio increased 7.8% from a year ago and for Washington DC, it rose 2.3%.
As of Dec 31, 2016, Vornado had $1.50 billion of cash and cash equivalents, down from $1.84 billion as of Dec 31, 2015.
Other Important Developments
On Oct 31, 2016, Vornado’s Board of Trustees approved the tax-free spin-off of the Washington, DC segment and signed an agreement to merge it with the business and certain select assets of The JBG Companies, a Washington, DC real estate company.
On Dec 19, 2016, the company closed the sale of its 20% interest in Fairfax Square to its joint venture partner for $15.5 million. Moreover, on Dec 21, 2016 Vornado announced the final disposition of its Skyline properties in Fairfax, VA.
On Dec 2, 2016, the company closed a $400 million refinancing of 350 Park Avenue, a 571,000 square foot Manhattan office building. The company realized net proceeds of approximately $111 million.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed a downward trend in fresh estimates. There has been one revision lower for the current quarter.
Vornado Realty Trust Price and Consensus
Vornado Realty Trust Price and Consensus | Vornado Realty Trust Quote
VGM Scores
At this time, Vornado Realty's stock has a poor Growth Score of 'F', however its Momentum is doing a lot better with a 'B'. However, the stock was allocated a grade of 'D' on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'F'. If you aren't focused on one strategy, this score is the one you should be interested in.
The company's stock is suitable solely for momentum based on our styles scores.
Outlook
While estimates have been broadly trending downward for the stock, the magnitude of this revision looks promising. Notably, the stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.