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Cousins Properties (CUZ) Q3 FFO Tops, Revenues Miss Estimates
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Cousins Properties Incorporated (CUZ - Free Report) reported third-quarter 2018 funds from operations (FFO) per share of 16 cents, beating the Zacks Consensus Estimate by a whisker. Further, the figure came in higher than the prior-year tally of 15 cents.
Cousin Properties’ third quarter total revenue figure recorded a year-over-year decline. Nevertheless, the company witnessed increment in same-property cash net operating income (NOI).
Rental property revenues for the quarter came in at $115.4 million, which compares favorably with $109.6 million witnessed in the year-ago quarter. However, the figure missed the Zacks Consensus Estimate of $118.7 million. Total revenues came in at $118.7 million, lower than $113.1 million reported in the prior-year period.
Quarter in Detail
Cousins Properties executed leases for 485,598 square feet of office space in the Jul-Sep quarter. Same-property NOI, on a cash basis, rose 4.4% from the year-ago quarter. Moreover, second-generation net rent per square foot (cash basis) increased 7.6%.
During the quarter, the company expanded its new office development in the Austin CBD — 300 Colorado — by adding two floors. This brings the total property at 358,000 square feet of space.
Total costs and expenses came in at nearly 101.2 million, down 2.4% from the prior-year quarter.
Cousins Properties exited the third quarter with cash and cash equivalents of $82.7 million, as against $148.9 million recorded as of Dec 31, 2017.
2018 Outlook
Cousins Properties raised and narrowed its full-year 2018 FFO per share guidance. The company now expects FFO for the year to be in the band of 60-63 cents from the previous range of 59-63 cents. The Zacks Consensus Estimate for the current-year FFO per share is currently pinned at 61 cents.
Conclusion
This premium sunbelt office REIT’s properties located in the most sought-after markets enable the company to enjoy robust rent growth and higher absorption. Furthermore, it maintains a strong balance sheet with decent liquidity and easy access to debt markets. A healthy financial position will provide dry power to the company to execute its strategic priorities.
However, amid rising interest-rate environment, the company’s interest expense has been flaring up. In addition, its ability to refinance existing debt would be restricted, while interest cost on new debt may escalate. This, in turn, could adversely impact the company’s bottom-line growth.
Cousins Properties Incorporated Price, Consensus and EPS Surprise
We now look forward to the earnings releases of other REITs like EPR Properties (EPR - Free Report) , Vornado Realty Trust (VNO - Free Report) and UDR Inc. (UDR - Free Report) . All three companies are scheduled to release their quarterly figures on Oct 29.
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.
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Cousins Properties (CUZ) Q3 FFO Tops, Revenues Miss Estimates
Cousins Properties Incorporated (CUZ - Free Report) reported third-quarter 2018 funds from operations (FFO) per share of 16 cents, beating the Zacks Consensus Estimate by a whisker. Further, the figure came in higher than the prior-year tally of 15 cents.
Cousin Properties’ third quarter total revenue figure recorded a year-over-year decline. Nevertheless, the company witnessed increment in same-property cash net operating income (NOI).
Rental property revenues for the quarter came in at $115.4 million, which compares favorably with $109.6 million witnessed in the year-ago quarter. However, the figure missed the Zacks Consensus Estimate of $118.7 million. Total revenues came in at $118.7 million, lower than $113.1 million reported in the prior-year period.
Quarter in Detail
Cousins Properties executed leases for 485,598 square feet of office space in the Jul-Sep quarter. Same-property NOI, on a cash basis, rose 4.4% from the year-ago quarter. Moreover, second-generation net rent per square foot (cash basis) increased 7.6%.
During the quarter, the company expanded its new office development in the Austin CBD — 300 Colorado — by adding two floors. This brings the total property at 358,000 square feet of space.
Total costs and expenses came in at nearly 101.2 million, down 2.4% from the prior-year quarter.
Cousins Properties exited the third quarter with cash and cash equivalents of $82.7 million, as against $148.9 million recorded as of Dec 31, 2017.
2018 Outlook
Cousins Properties raised and narrowed its full-year 2018 FFO per share guidance. The company now expects FFO for the year to be in the band of 60-63 cents from the previous range of 59-63 cents. The Zacks Consensus Estimate for the current-year FFO per share is currently pinned at 61 cents.
Conclusion
This premium sunbelt office REIT’s properties located in the most sought-after markets enable the company to enjoy robust rent growth and higher absorption. Furthermore, it maintains a strong balance sheet with decent liquidity and easy access to debt markets. A healthy financial position will provide dry power to the company to execute its strategic priorities.
However, amid rising interest-rate environment, the company’s interest expense has been flaring up. In addition, its ability to refinance existing debt would be restricted, while interest cost on new debt may escalate. This, in turn, could adversely impact the company’s bottom-line growth.
Cousins Properties Incorporated Price, Consensus and EPS Surprise
Cousins Properties Incorporated Price, Consensus and EPS Surprise | Cousins Properties Incorporated Quote
Currently, Cousins Properties has a Zacks Rank #3 (Hold). You can the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
We now look forward to the earnings releases of other REITs like EPR Properties (EPR - Free Report) , Vornado Realty Trust (VNO - Free Report) and UDR Inc. (UDR - Free Report) . All three companies are scheduled to release their quarterly figures on Oct 29.
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.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>