We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Why Is Essex Property (ESS) Up 6.2% Since the Last Earnings Report?
Read MoreHide Full Article
A month has gone by since the last earnings report for Essex Property Trust, Inc. (ESS - Free Report) . Shares have added about 6.2% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock’s next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Essex Property Beats Q1 FFO and Revenue Estimates
Essex Property delivered a better-than-expected performance for first-quarter 2017. The company reported core FFO per share of $2.94 for the quarter, beating the Zacks Consensus Estimate of $2.89. Core FFO per share also improved 9.7% from the year-ago quarter figure of $2.68. Results were backed by solid growth in revenues.
Total revenue of $335.4 million in the quarter exceeded the Zacks Consensus Estimate of $332.8 million and was up 6.7% year over year.
Per the management, the first-quarter 2017 results “reflect a recovery from challenging conditions experienced in the fourth quarter”. In addition, results were solid in the Seattle portfolio and the company witnessed better pricing power in Northern California amid lesser deliveries of apartment supply.
Quarter in Detail
During the quarter, Essex Property’s same-property gross revenues grew 5.0% from the prior-year quarter, while same- property net operating income (NOI) improved 5.6% year over year. Financial occupancies of 96.5% expanded 50 basis points (bps) year over year.
During the quarter, the company acquired its joint-venture partner’s 50% stake in Palm Valley, for a contract price of $183.0 million. Located in San Jose, CA, the property has 1,098 apartment homes within four communities on 37 acres.
On the other hand, the company sold Jefferson at Hollywood in Los Angeles, CA, for a total contract price of $132.5 million. Total gain on the sale was $26.2 million.
Essex Property exited first-quarter 2017 with cash and cash equivalents, including restricted, of $100.3 million, down from $170.3 million at the end of 2016. As of Apr 24, 2017, the company had $1.025 billion in undrawn capacity on its unsecured credit facilities.
Outlook
Essex Property raised its guidance for 2017. The company projects core FFO per share in the range of $11.56–$11.96 from $11.48–$11.88 guided earlier, denoting an increase of $0.08 at the mid-point.
Further, the company revised estimates for same-property gross revenue growth to 3.0–4.0% from the prior range of 2.75–3.75%. Same-property NOI is now guided in the band of 2.8–4.6% from the previous range of 2.5–4.25%.
For second-quarter 2017, the company foresees core FFO per share in the $2.82–$2.92 range.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed an upward trend in fresh estimates. There have been two upward revisions for the current quarter compared to one downward.
At this time, Essex Property's stock has an average Growth Score of 'C', however its Momentum is doing a lot better with an 'A'. However, the stock was allocated a grade of 'F' on the value side, putting it in the bottom 20% quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'D'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for momentum investors than growth investors.
Outlook
The stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why Is Essex Property (ESS) Up 6.2% Since the Last Earnings Report?
A month has gone by since the last earnings report for Essex Property Trust, Inc. (ESS - Free Report) . Shares have added about 6.2% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock’s next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Essex Property Beats Q1 FFO and Revenue Estimates
Essex Property delivered a better-than-expected performance for first-quarter 2017. The company reported core FFO per share of $2.94 for the quarter, beating the Zacks Consensus Estimate of $2.89. Core FFO per share also improved 9.7% from the year-ago quarter figure of $2.68. Results were backed by solid growth in revenues.
Total revenue of $335.4 million in the quarter exceeded the Zacks Consensus Estimate of $332.8 million and was up 6.7% year over year.
Per the management, the first-quarter 2017 results “reflect a recovery from challenging conditions experienced in the fourth quarter”. In addition, results were solid in the Seattle portfolio and the company witnessed better pricing power in Northern California amid lesser deliveries of apartment supply.
Quarter in Detail
During the quarter, Essex Property’s same-property gross revenues grew 5.0% from the prior-year quarter, while same- property net operating income (NOI) improved 5.6% year over year. Financial occupancies of 96.5% expanded 50 basis points (bps) year over year.
During the quarter, the company acquired its joint-venture partner’s 50% stake in Palm Valley, for a contract price of $183.0 million. Located in San Jose, CA, the property has 1,098 apartment homes within four communities on 37 acres.
On the other hand, the company sold Jefferson at Hollywood in Los Angeles, CA, for a total contract price of $132.5 million. Total gain on the sale was $26.2 million.
Essex Property exited first-quarter 2017 with cash and cash equivalents, including restricted, of $100.3 million, down from $170.3 million at the end of 2016. As of Apr 24, 2017, the company had $1.025 billion in undrawn capacity on its unsecured credit facilities.
Outlook
Essex Property raised its guidance for 2017. The company projects core FFO per share in the range of $11.56–$11.96 from $11.48–$11.88 guided earlier, denoting an increase of $0.08 at the mid-point.
Further, the company revised estimates for same-property gross revenue growth to 3.0–4.0% from the prior range of 2.75–3.75%. Same-property NOI is now guided in the band of 2.8–4.6% from the previous range of 2.5–4.25%.
For second-quarter 2017, the company foresees core FFO per share in the $2.82–$2.92 range.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed an upward trend in fresh estimates. There have been two upward revisions for the current quarter compared to one downward.
Essex Property Trust, Inc. Price and Consensus
Essex Property Trust, Inc. Price and Consensus | Essex Property Trust, Inc. Quote
VGM Scores
At this time, Essex Property's stock has an average Growth Score of 'C', however its Momentum is doing a lot better with an 'A'. However, the stock was allocated a grade of 'F' on the value side, putting it in the bottom 20% quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'D'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for momentum investors than growth investors.
Outlook
The stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.