A month has gone by since the last earnings report for Mid-America Apartment Communities (MAA Quick QuoteMAA - Free Report) . Shares have lost about 1% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Mid-America Apartment Communities 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 catalysts.

Mid-America Apartment Q2 FFO & Revenues Top Estimates

MAA reported second-quarter 2020 core FFO per share of $1.59, surpassing the Zacks Consensus Estimate of $1.54. Further, the reported tally comes in higher than the prior-year quarter’s $1.53.

The residential REIT’s quarterly results reflected growth in same-store NOI and rise in average effective rent per unit for the same-store portfolio.

Rental and other property revenues came in at $413 million in the June-end quarter, outpacing the Zacks Consensus Estimate of $410.6 million. The reported figure was also up 1.4% higher than the year-ago quarter’s $407.4 million.

The company stated that as of Jul 27, rent cash receipts and deferred payments aggregated 99.4% and 98.4% of billed residential rent for the second quarter and July, respectively. As of the same date, average physical occupancy for the same-store portfolio was 95.3% for July.

Quarter in Detail

The same-store portfolio revenues grew 2.1% on rise in average effective rent per unit of 3.4%, year over year. During the second quarter, the company’s same-store NOI increased 2% year over year. However, average physical occupancy for the same-store portfolio was 95.4%, contracting 60 bps, year over year.

During the second quarter, rent growth in the company’s same-store portfolio for both new and renewing leases, compared with the prior lease, came in at 1.2% on a combined basis.

As of Jun 30, 2020, unencumbered NOI was 91.1% of total NOI, higher than the 90.6% reported as of Mar 31, 2020.

As of Jun 30, 2020, MAA held cash and cash equivalents of $19.7 million, down from $20.5 million as of Dec 31, 2019. Additionally, as of the same date, total debt outstanding was $4.5 billion.

Furthermore, as of the same date, $926.6 million of combined cash and capacity were available under its unsecured revolving credit facility, net of commercial paper borrowings.

Portfolio Activity

During the April-June quarter, the company did not undertake any acquisition or disposition activities of apartment communities, land parcels or commercial properties.

In May, the company resumed its interior redevelopment program, which was previously suspended due the pandemic. During the second quarter, it redeveloped 655 units. As of Jun 30, 2020, the company had six development communities under construction with an expected average stabilized NOI yield of 6.1%.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in estimates revision.

VGM Scores

Currently, Mid-America Apartment Communities has an average Growth Score of C, however its Momentum Score is doing a bit 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

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Mid-America Apartment Communities has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.