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PS Business Parks (PSB) Q1 FFO Beats on Rental Rate Growth
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PS Business Parks, Inc. reported first-quarter 2019 core funds from operations (FFO) of $1.67 per share, beating the Zacks Consensus Estimate by a penny. The figure also comes in 5% higher than the prior-year quarter’s $1.59.
Results highlight improvement in Same-Park net operating income (NOI) backed by growth in rental rates and occupancy, as well as improved NOI from non-Same-Park and multi-family assets. However, NOI reduction due to facilities sold in 2018 partly offset the positives.
Rental income came in at around $107.8 million, marking 3.9% growth from the year-ago quarter tally. The reported figure also exceeded the Zacks Consensus Estimate of $103.1 million.
Quarter in Detail
Same-Park rental income was up 4.3% year over year to $102.8 million, while Same-Park NOI climbed 4.3% year over year to $71.8 million, driven by improving rental rates and occupancy level.
Same-Park annualized revenue per occupied-square-foot increased 4% to $16.04, while weighted average square-foot occupancy was 94.5%, up 30 basis points year over year.
Liquidity
PS Business Parks exited first-quarter 2019 with cash and cash equivalents of $39.4 million, up from $37.4 million reported at the end of 2018.
Dividend Update
On Apr 23, the company announced a quarterly dividend of $1.05 per share. The dividend is payable on Jun 27, to shareholders of record as of Jun 12, 2019.
Conclusion
We are encouraged with the decent FFO per share performance of PS Business Parks in the first quarter. The company is expected to benefit from healthy fundamentals in the industrial and flex categories, in the days ahead. Its portfolio is well diversified with respect to tenants and markets.
Moreover, PS Business Parks has ample financial flexibility to cushion and enhance its market position, while asset-repositioning efforts are likely to improve the overall portfolio quality. Nevertheless, supply is rising in certain submarkets and this could partly impede its growth momentum.
We now look forward to the earnings releases of other REITs like Apartment Investment and Management Company (AIV - Free Report) , Regency Centers Corporation (REG - Free Report) and Federal Realty Investment Trust (FRT - Free Report) which are slated to report their quarterly numbers on May 2.
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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PS Business Parks (PSB) Q1 FFO Beats on Rental Rate Growth
PS Business Parks, Inc. reported first-quarter 2019 core funds from operations (FFO) of $1.67 per share, beating the Zacks Consensus Estimate by a penny. The figure also comes in 5% higher than the prior-year quarter’s $1.59.
Results highlight improvement in Same-Park net operating income (NOI) backed by growth in rental rates and occupancy, as well as improved NOI from non-Same-Park and multi-family assets. However, NOI reduction due to facilities sold in 2018 partly offset the positives.
Rental income came in at around $107.8 million, marking 3.9% growth from the year-ago quarter tally. The reported figure also exceeded the Zacks Consensus Estimate of $103.1 million.
Quarter in Detail
Same-Park rental income was up 4.3% year over year to $102.8 million, while Same-Park NOI climbed 4.3% year over year to $71.8 million, driven by improving rental rates and occupancy level.
Same-Park annualized revenue per occupied-square-foot increased 4% to $16.04, while weighted average square-foot occupancy was 94.5%, up 30 basis points year over year.
Liquidity
PS Business Parks exited first-quarter 2019 with cash and cash equivalents of $39.4 million, up from $37.4 million reported at the end of 2018.
Dividend Update
On Apr 23, the company announced a quarterly dividend of $1.05 per share. The dividend is payable on Jun 27, to shareholders of record as of Jun 12, 2019.
Conclusion
We are encouraged with the decent FFO per share performance of PS Business Parks in the first quarter. The company is expected to benefit from healthy fundamentals in the industrial and flex categories, in the days ahead. Its portfolio is well diversified with respect to tenants and markets.
Moreover, PS Business Parks has ample financial flexibility to cushion and enhance its market position, while asset-repositioning efforts are likely to improve the overall portfolio quality. Nevertheless, supply is rising in certain submarkets and this could partly impede its growth momentum.
PS Business Parks currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
PS Business Parks, Inc. Price, Consensus and EPS Surprise
PS Business Parks, Inc. Price, Consensus and EPS Surprise | PS Business Parks, Inc. Quote
We now look forward to the earnings releases of other REITs like Apartment Investment and Management Company (AIV - Free Report) , Regency Centers Corporation (REG - Free Report) and Federal Realty Investment Trust (FRT - Free Report) which are slated to report their quarterly numbers on May 2.
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.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 7 stocks to watch. The report is only available for a limited time.
See 7 breakthrough stocks now>>