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Bear of the Day: Cedar Realty Trust, Inc. (CDR)

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Cedar Realty Trust, Inc. stock is up big over the last year. But the REIT’s near-term outlook is far from impressive and it fell short of our second quarter estimates at the end of July.

What’s Going On?

Cedar Realty Trust is a fully-integrated REIT focused on the ownership, operation, and redevelopment of grocery-anchored shopping centers. The company operates in high-density urban areas ranging from Boston to D.C. CDR’s revenue fell 5% in 2019 and 6% during the covid-hit 2020.

Cedar Realty Trust’s second quarter sales then fell below Zacks estimates, as did its funds from operations. Instead of earnings, REITs report funds from operations or FFO, but investors can view them as essentially the same thing.

Zacks Investment Research
Image Source: Zacks Investment Research

Despite its recent performance and its declining revenue, the stock has skyrocketed 190% in the past year to crush its industry’s 25% climb.

But the last 12 months hardly tell a complete story because even with its strong showing the stock is down 65% in the past five years. The stock has slipped from its 52-week highs recently and it was down 2.8% during regular hours Thursday.

Bottom Line

Cedar Realty Trust’s FFO outlook has trended in the wrong direction since its report on July 29 to help it land a Zacks Rank #5 (Strong Sell), alongside “D” grades for Growth and Momentum in our Style Scores system.

Zacks estimates call for its FY21 FFO to slip 20% on 6% lower sales. Therefore, the stock might be worth staying away from at the moment, especially considering its massive year-long run.

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