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Why Is Kimco Realty (KIM) Down 10.3% Since Last Earnings Report?
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A month has gone by since the last earnings report for Kimco Realty (KIM - Free Report) . Shares have lost about 10.3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Kimco Realty due for a breakout? 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.
Kimco Realty Q4 FFO & Revenues Top Estimates, NOI Up
Kimco Realty’s fourth-quarter 2019 FFO as adjusted, excluding the impact of transactional income and charges, came in at 37 cents per share, surpassing the Zacks Consensus Estimate of 36 cents. The reported tally came in higher than the year-ago quarter’s FFO as adjusted of 35 cents per share.
Results reflect portfolio occupancy maintaining an all-time high level, healthy leasing spreads on new lease and positive same-property NOI. The company registered new leasing spreads of 12.5%. This marks the 24th straight quarter in which spreads on new leases improved in double digits.
The retail REIT generated revenues of $296.1 million, beating the Zacks Consensus Estimate of $281.7 million. The revenue figure also compared favorably with the year-ago number of $284.2 million.
For full-year 2019, the FFO per share came in at $1.47, matching the Zacks Consensus Estimate and higher than the prior-year tally of $1.45. However, revenues witnessed a marginal decline, year over year, to $1.16 billion.
Quarter in Detail
At the end of the fourth quarter, the company maintained its all-time high level of pro-rata occupancy at 96.4%. This marked an expansion of 150 basis points (bps) year on year.
Pro-rata anchor occupancy ended the quarter at 98.9%, denoting a 150-basis-point expansion, year over year.
Pro-rata small-shop occupancy ended the reported quarter at 89.3%. This marks a year-over-year contraction of 180 bps, and 60 bps sequentially.
Pro-rata rental-rate leasing spreads increased 6%, with rental rates for new leases and renewals/options climbing 12.5% and 4%, respectively.
Same-property NOI grew 2.7% year over year.
Balance-Sheet Position
Kimco exited 2019 with cash and cash equivalents of $123.9 million, down from the $143.6 million recorded at the end of 2018.
During the fourth quarter, the company issued 9.5 million shares of common stock under its at-the-market (ATM) equity offering program, raising net proceeds of $200.1 million.
Portfolio Activity
During the reported quarter, Kimco sold 12 properties, aggregating 1.9 million square feet of space. The dispositions were made for $153 million, of which the company’s share amounted to $146.5 million. The company also disposed two wholly-owned land parcels for $47.5 million.
Guidance
Kimco has provided 2020 FFO projections, and estimates Nareit FFO per share in the $1.46-$1.50 range.
The company also issued its operational assumption for same-property NOI and forecasts it in the range of 1.5-2%.
Moreover, acquisitions for the year are projected to be worth $100-$200 million, with a blended cap rate of 5-6%. Disposition guidance is $200-$300 million, with a blended cap rate of 7-7.5%, and the combined redevelopment and development investment projection is in the band of $200-$250 million.
How Have Estimates Been Moving Since Then?
Estimates revision followed a downward path over the past two months.
VGM Scores
At this time, Kimco Realty has a subpar Growth Score of D, 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 D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Kimco Realty has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
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Why Is Kimco Realty (KIM) Down 10.3% Since Last Earnings Report?
A month has gone by since the last earnings report for Kimco Realty (KIM - Free Report) . Shares have lost about 10.3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Kimco Realty due for a breakout? 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.
Kimco Realty Q4 FFO & Revenues Top Estimates, NOI Up
Kimco Realty’s fourth-quarter 2019 FFO as adjusted, excluding the impact of transactional income and charges, came in at 37 cents per share, surpassing the Zacks Consensus Estimate of 36 cents. The reported tally came in higher than the year-ago quarter’s FFO as adjusted of 35 cents per share.
Results reflect portfolio occupancy maintaining an all-time high level, healthy leasing spreads on new lease and positive same-property NOI. The company registered new leasing spreads of 12.5%. This marks the 24th straight quarter in which spreads on new leases improved in double digits.
The retail REIT generated revenues of $296.1 million, beating the Zacks Consensus Estimate of $281.7 million. The revenue figure also compared favorably with the year-ago number of $284.2 million.
For full-year 2019, the FFO per share came in at $1.47, matching the Zacks Consensus Estimate and higher than the prior-year tally of $1.45. However, revenues witnessed a marginal decline, year over year, to $1.16 billion.
Quarter in Detail
At the end of the fourth quarter, the company maintained its all-time high level of pro-rata occupancy at 96.4%. This marked an expansion of 150 basis points (bps) year on year.
Pro-rata anchor occupancy ended the quarter at 98.9%, denoting a 150-basis-point expansion, year over year.
Pro-rata small-shop occupancy ended the reported quarter at 89.3%. This marks a year-over-year contraction of 180 bps, and 60 bps sequentially.
Pro-rata rental-rate leasing spreads increased 6%, with rental rates for new leases and renewals/options climbing 12.5% and 4%, respectively.
Same-property NOI grew 2.7% year over year.
Balance-Sheet Position
Kimco exited 2019 with cash and cash equivalents of $123.9 million, down from the $143.6 million recorded at the end of 2018.
During the fourth quarter, the company issued 9.5 million shares of common stock under its at-the-market (ATM) equity offering program, raising net proceeds of $200.1 million.
Portfolio Activity
During the reported quarter, Kimco sold 12 properties, aggregating 1.9 million square feet of space. The dispositions were made for $153 million, of which the company’s share amounted to $146.5 million. The company also disposed two wholly-owned land parcels for $47.5 million.
Guidance
Kimco has provided 2020 FFO projections, and estimates Nareit FFO per share in the $1.46-$1.50 range.
The company also issued its operational assumption for same-property NOI and forecasts it in the range of 1.5-2%.
Moreover, acquisitions for the year are projected to be worth $100-$200 million, with a blended cap rate of 5-6%. Disposition guidance is $200-$300 million, with a blended cap rate of 7-7.5%, and the combined redevelopment and development investment projection is in the band of $200-$250 million.
How Have Estimates Been Moving Since Then?
Estimates revision followed a downward path over the past two months.
VGM Scores
At this time, Kimco Realty has a subpar Growth Score of D, 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 D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Kimco Realty has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.