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EPR Properties' (EPR) Q1 Earnings: A Beat in the Cards?
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EPR Properties (EPR - Free Report) is scheduled to report first-quarter 2017 results on May 2, after the closing bell.
This real estate investment trust (“REIT”) delivered a positive surprise of 1.63% in the prior quarter. In fact, it topped the Zacks Consensus Estimate in three out of the trailing four quarters, with a positive average surprise of 0.83%.
Let’s see how things are shaping up for this announcement.
Why a Likely Positive Surprise?
Our proven model shows that EPR Properties is likely to beat estimates because it has the right combination of two key ingredients. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to beat estimates, and EPR Properties has the right mix.
Zacks ESP: The Earnings ESP, which represents the percentage difference between the Most Accurate estimate of $1.20 and the Zacks Consensus Estimate of $1.19, is +0.84%. This is a major indicator of a likely positive surprise. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: EPR Properties carries a Zacks Rank #3.
The combination of EPR Properties’ favorable Zacks Rank and positive ESP makes us reasonably confident of a positive surprise this season.
Conversely, we caution against stocks with Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
What's Driving the Better-than-Expected Earnings?
EPR Properties is a specialty REIT that focuses on investments in properties across three primary market segments – Entertainment, Recreation and Education. Strategic investment in each of its segments and a diversified tenant base are likely to boost first-quarter results. In fact, upbeat consumer confidence and an improving economy are expected to drive the company’s performance.
Specifically, the Entertainment segment is likely to benefit from the growth in the millennial generation. This is because millennials constitute the major chunk of frequent moviegoers and over time this group has been growing considerably. Moreover, the renovation works and new food and beverage concepts introduced in megaplex theatres are aimed at improving customer experience and are likely to improve attendance and enhance revenues in the to-be-reported quarter.
Also, with an economic recovery backed by job growth, the Recreation segment promises an impressive performance, led by solid demand for properties. Further, EPR Properties is well poised to benefit from investments in the Education segment and experience growth in enrollment as there is a healthy demand for quality education and associated facilities amid modest supply.
Moreover, over the past six months, shares of EPR Properties outperformed the Zacks categorized REIT and Equity Trust – Retail industry. Over this time frame, EPR Properties’ shares logged in a return of 3.9% against the 5.0% decline of the industry.
However, over the past seven days, the Zacks Consensus Estimate for first-quarter FFO per share remained unchanged.
Other Stocks that Warrant a Look
Here are a few stocks in the REIT sector that you may want to consider, as our model shows that they have the right combination of elements to report a positive surprise this quarter:
HCP Inc. (HCP - Free Report) , slated to release earnings on May 2, has an Earnings ESP of +2.08% and a Zacks Rank #3.
STORE Capital Corporation , scheduled to release earnings on May 4, has an Earnings ESP of +2.44% and a Zacks Rank #3.
Note: All EPS numbers presented in this write up represent funds from operations (“FFO”) per share. FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
The Best & Worst of Zacks
Today you are invited to download the full, up-to-the-minute list of 220 Zacks Rank #1 "Strong Buys" free of charge. From 1988 through 2015 this list has averaged a stellar gain of +25% per year. Plus, you may download 220 Zacks Rank #5 "Strong Sells." Even though this list holds many stocks that seem to be solid, it has historically performed 6X worse than the market. See these critical buys and sells free >>
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EPR Properties' (EPR) Q1 Earnings: A Beat in the Cards?
EPR Properties (EPR - Free Report) is scheduled to report first-quarter 2017 results on May 2, after the closing bell.
This real estate investment trust (“REIT”) delivered a positive surprise of 1.63% in the prior quarter. In fact, it topped the Zacks Consensus Estimate in three out of the trailing four quarters, with a positive average surprise of 0.83%.
This is depicted in the graph below.
EPR Properties Price and EPS Surprise
EPR Properties Price and EPS Surprise | EPR Properties Quote
Let’s see how things are shaping up for this announcement.
Why a Likely Positive Surprise?
Our proven model shows that EPR Properties is likely to beat estimates because it has the right combination of two key ingredients. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to beat estimates, and EPR Properties has the right mix.
Zacks ESP: The Earnings ESP, which represents the percentage difference between the Most Accurate estimate of $1.20 and the Zacks Consensus Estimate of $1.19, is +0.84%. This is a major indicator of a likely positive surprise. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: EPR Properties carries a Zacks Rank #3.
The combination of EPR Properties’ favorable Zacks Rank and positive ESP makes us reasonably confident of a positive surprise this season.
Conversely, we caution against stocks with Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
What's Driving the Better-than-Expected Earnings?
EPR Properties is a specialty REIT that focuses on investments in properties across three primary market segments – Entertainment, Recreation and Education. Strategic investment in each of its segments and a diversified tenant base are likely to boost first-quarter results. In fact, upbeat consumer confidence and an improving economy are expected to drive the company’s performance.
Specifically, the Entertainment segment is likely to benefit from the growth in the millennial generation. This is because millennials constitute the major chunk of frequent moviegoers and over time this group has been growing considerably. Moreover, the renovation works and new food and beverage concepts introduced in megaplex theatres are aimed at improving customer experience and are likely to improve attendance and enhance revenues in the to-be-reported quarter.
Also, with an economic recovery backed by job growth, the Recreation segment promises an impressive performance, led by solid demand for properties. Further, EPR Properties is well poised to benefit from investments in the Education segment and experience growth in enrollment as there is a healthy demand for quality education and associated facilities amid modest supply.
Moreover, over the past six months, shares of EPR Properties outperformed the Zacks categorized REIT and Equity Trust – Retail industry. Over this time frame, EPR Properties’ shares logged in a return of 3.9% against the 5.0% decline of the industry.
However, over the past seven days, the Zacks Consensus Estimate for first-quarter FFO per share remained unchanged.
Other Stocks that Warrant a Look
Here are a few stocks in the REIT sector that you may want to consider, as our model shows that they have the right combination of elements to report a positive surprise this quarter:
Hudson Pacific Properties, Inc. (HPP - Free Report) , slated to release first-quarter results on May 4, has an Earnings ESP of +2.08% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
HCP Inc. (HCP - Free Report) , slated to release earnings on May 2, has an Earnings ESP of +2.08% and a Zacks Rank #3.
STORE Capital Corporation , scheduled to release earnings on May 4, has an Earnings ESP of +2.44% and a Zacks Rank #3.
Note: All EPS numbers presented in this write up represent funds from operations (“FFO”) per share. FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
The Best & Worst of Zacks
Today you are invited to download the full, up-to-the-minute list of 220 Zacks Rank #1 "Strong Buys" free of charge. From 1988 through 2015 this list has averaged a stellar gain of +25% per year. Plus, you may download 220 Zacks Rank #5 "Strong Sells." Even though this list holds many stocks that seem to be solid, it has historically performed 6X worse than the market. See these critical buys and sells free >>