A month has gone by since the last earnings report for Liberty Property . Shares have lost about 1.8% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Liberty Property 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.
Liberty Property Q2 FFO & Revenues Surpass Estimates
Liberty Property reported second-quarter 2019 NAREIT FFO per share of 68 cents, which surpassed the Zacks Consensus Estimate of 65 cents. Comparable NAREIT FFO per share in the prior-year quarter was 12 cents per share.
Results reflect 2.9% increase in cash same-store operating income. Amid healthy demand from users for industrial space, the company witnessed solid leasing activity.
However, revenues were down 2.8% from the prior-year quarter to $161.3 million. Nevertheless, the top line surpassed the Zacks Consensus Estimate of $160 million.
Quarter in Detail
For its industrial portfolio, during the reported quarter, Liberty Property accomplished lease deals for 8.6 million square feet of space. As of Jun 30, 2019, occupancy at the company’s in-service operating portfolio, spanning 104 million square feet, shrunk 40 basis points sequentially to 95.2%. However, rents increased 2.9% on a cash basis (11.9% GAAP) on retention and replacement leases commenced during the quarter.
Property level operating income for same-store properties were up 2.9% on a cash basis (0.2% GAAP) year over year.
Portfolio Activity
During the June-ended quarter, Liberty Property acquired one industrial property, spanning 218,000 square feet of space, for $26.5 million. At the same time, the company sold four operating properties, aggregating 227,400 square feet of space, for $103.1 million.
The company brought into service two industrial properties, comprising 823,600 square feet of space for a total investment of $79.3 million. These properties were 95% occupied as of the end of the second quarter.
Balance-Sheet Position
Liberty Property exited the second quarter with cash and cash equivalents of around $21 million, down from $84.9 million recorded at the end of December 2018.
Outlook
Liberty Property reiterated its guidance for 2019. The company guided NAREIT FFO per share of $2.55-$2.65.
The company expects same-store property level operating income for industrial properties to be up 1.6-2.6% on a GAAP basis and 3-4% on a cash basis.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
VGM Scores
Currently, Liberty Property has a poor Growth Score of F, however its Momentum Score 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.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions has been net zero. Notably, Liberty Property has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Liberty Property (LPT) Down 1.8% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for Liberty Property . Shares have lost about 1.8% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Liberty Property 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.
Liberty Property Q2 FFO & Revenues Surpass Estimates
Liberty Property reported second-quarter 2019 NAREIT FFO per share of 68 cents, which surpassed the Zacks Consensus Estimate of 65 cents. Comparable NAREIT FFO per share in the prior-year quarter was 12 cents per share.
Results reflect 2.9% increase in cash same-store operating income. Amid healthy demand from users for industrial space, the company witnessed solid leasing activity.
However, revenues were down 2.8% from the prior-year quarter to $161.3 million. Nevertheless, the top line surpassed the Zacks Consensus Estimate of $160 million.
Quarter in Detail
For its industrial portfolio, during the reported quarter, Liberty Property accomplished lease deals for 8.6 million square feet of space. As of Jun 30, 2019, occupancy at the company’s in-service operating portfolio, spanning 104 million square feet, shrunk 40 basis points sequentially to 95.2%. However, rents increased 2.9% on a cash basis (11.9% GAAP) on retention and replacement leases commenced during the quarter.
Property level operating income for same-store properties were up 2.9% on a cash basis (0.2% GAAP) year over year.
Portfolio Activity
During the June-ended quarter, Liberty Property acquired one industrial property, spanning 218,000 square feet of space, for $26.5 million. At the same time, the company sold four operating properties, aggregating 227,400 square feet of space, for $103.1 million.
The company brought into service two industrial properties, comprising 823,600 square feet of space for a total investment of $79.3 million. These properties were 95% occupied as of the end of the second quarter.
Balance-Sheet Position
Liberty Property exited the second quarter with cash and cash equivalents of around $21 million, down from $84.9 million recorded at the end of December 2018.
Outlook
Liberty Property reiterated its guidance for 2019. The company guided NAREIT FFO per share of $2.55-$2.65.
The company expects same-store property level operating income for industrial properties to be up 1.6-2.6% on a GAAP basis and 3-4% on a cash basis.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
VGM Scores
Currently, Liberty Property has a poor Growth Score of F, however its Momentum Score 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.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions has been net zero. Notably, Liberty Property has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.