Equity Residential’s (EQR - Free Report) reported first-quarter 2022 normalized funds from operations (FFO) per share of 77 cents, missing the Zacks Consensus Estimate of 80 cents.
Rental income came in at $653.3 million, lagging the consensus mark of $658.07 million.
Nonetheless, on a year-over-year basis, normalized FFO per share improved 13.2%, while rental income climbed 9.3%. Normalized FFO grew based on strong lease demand, while same-store revenue witnessed growth driven by strong physical occupancy and improvement in pricing power.
Quarter in Detail
Residential same-store revenues (including 74,675 apartment units) were up 7.8% year over year to $595.3 million, while same-store expenses flared up 2.5% to $203.8 million. As a result, same-store NOI improved 10.8% to $391.6 million.
The average rental rate increased 6.2% year over year to $2,757 during the March quarter, while physical occupancy expanded 140 basis points to 96.4% for the same-store portfolio.
EQR’s capital expenditure in real estate for same-store properties in the quarter was $33 million.
In the first quarter, the company purchased a 172-unit apartment property in San Diego for $113.0 million.
It did not sell any properties during the first quarter of 2022.
As of Mar 31, 2022, the resident/tenant accounts receivable balance was $42.8 million, up 14.6% from the previous quarter.
Balance Sheet
Equity Residential exited first-quarter 2022 with cash and cash equivalents of $41.1 million, down from $123.8 million recorded at the end of 2021.
The net debt to normalized EBITDAre was 5.38X compared with 5.61X from the previous quarter.
Outlook
For second-quarter 2022, Equity Residential projects a normalized FFO per share of 82-86 cents. The Zacks Consensus Estimate for the same is currently pegged at 85 cents.
For 2022, management maintains its previous guidance. Normalized FFO per share is expected in the range of $3.40-$3.50. The Zacks Consensus Estimate is pegged at $3.44.
Equity Residential anticipates same-store revenues to improve 8-10% for 2022. Projected expenses are expected to rise 2.5-3.5%. NOI improvement of 11-13% for the full year is projected. Physical occupancy is expected to be 96.5% for this period.
Equity Residential currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other REITs
SL Green Realty (SLG - Free Report) reported first quarter 2022 FFO per share of $1.65, beating the Zacks Consensus Estimate by a cent. However, the reported FFO per share compared unfavorably with the year-ago quarter’s $1.73.
SLG first-quarter performance was driven by a better-than-expected top line and healthy leasing activity.
Crown Castle International Corp.’s (CCI - Free Report) first-quarter 2022 adjusted funds from operations (AFFO) per share of $1.87 surpassed the Zacks Consensus Estimate of $1.80. Net revenues of $1.74 billion exceeded the Zacks Consensus Estimate of $1.70 billion.
Growth in site-rental revenues due to elevated tower space demand aided the top-line performance. CCI also raised the outlook for site-rental revenues and adjusted EBITDA for 2022.
Alexandria Real Estate Equities, Inc. (ARE - Free Report) reported first-quarter 2022 adjusted FFO per share of $2.05, surpassing the Zacks Consensus Estimate of $2.00. The reported FFO per share also compared favorably with the year-ago quarter’s $1.91.
Alexandria witnessed continued healthy leasing activity and rental rate growth during the quarter.
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.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Equity Residential’s (EQR - Free Report) reported first-quarter 2022 normalized funds from operations (FFO) per share of 77 cents, missing the Zacks Consensus Estimate of 80 cents.
Rental income came in at $653.3 million, lagging the consensus mark of $658.07 million.
Nonetheless, on a year-over-year basis, normalized FFO per share improved 13.2%, while rental income climbed 9.3%. Normalized FFO grew based on strong lease demand, while same-store revenue witnessed growth driven by strong physical occupancy and improvement in pricing power.
Quarter in Detail
Residential same-store revenues (including 74,675 apartment units) were up 7.8% year over year to $595.3 million, while same-store expenses flared up 2.5% to $203.8 million. As a result, same-store NOI improved 10.8% to $391.6 million.
The average rental rate increased 6.2% year over year to $2,757 during the March quarter, while physical occupancy expanded 140 basis points to 96.4% for the same-store portfolio.
EQR’s capital expenditure in real estate for same-store properties in the quarter was $33 million.
In the first quarter, the company purchased a 172-unit apartment property in San Diego for $113.0 million.
It did not sell any properties during the first quarter of 2022.
As of Mar 31, 2022, the resident/tenant accounts receivable balance was $42.8 million, up 14.6% from the previous quarter.
Balance Sheet
Equity Residential exited first-quarter 2022 with cash and cash equivalents of $41.1 million, down from $123.8 million recorded at the end of 2021.
The net debt to normalized EBITDAre was 5.38X compared with 5.61X from the previous quarter.
Outlook
For second-quarter 2022, Equity Residential projects a normalized FFO per share of 82-86 cents. The Zacks Consensus Estimate for the same is currently pegged at 85 cents.
For 2022, management maintains its previous guidance. Normalized FFO per share is expected in the range of $3.40-$3.50. The Zacks Consensus Estimate is pegged at $3.44.
Equity Residential anticipates same-store revenues to improve 8-10% for 2022. Projected expenses are expected to rise 2.5-3.5%. NOI improvement of 11-13% for the full year is projected. Physical occupancy is expected to be 96.5% for this period.
Equity Residential currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other REITs
SL Green Realty (SLG - Free Report) reported first quarter 2022 FFO per share of $1.65, beating the Zacks Consensus Estimate by a cent. However, the reported FFO per share compared unfavorably with the year-ago quarter’s $1.73.
SLG first-quarter performance was driven by a better-than-expected top line and healthy leasing activity.
Crown Castle International Corp.’s (CCI - Free Report) first-quarter 2022 adjusted funds from operations (AFFO) per share of $1.87 surpassed the Zacks Consensus Estimate of $1.80. Net revenues of $1.74 billion exceeded the Zacks Consensus Estimate of $1.70 billion.
Growth in site-rental revenues due to elevated tower space demand aided the top-line performance. CCI also raised the outlook for site-rental revenues and adjusted EBITDA for 2022.
Alexandria Real Estate Equities, Inc. (ARE - Free Report) reported first-quarter 2022 adjusted FFO per share of $2.05, surpassing the Zacks Consensus Estimate of $2.00. The reported FFO per share also compared favorably with the year-ago quarter’s $1.91.
Alexandria witnessed continued healthy leasing activity and rental rate growth during the quarter.
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.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Get the latest research report on EQR - FREE
Get the latest research report on CCI - FREE
Get the latest research report on SLG - FREE
Get the latest research report on ARE - FREE