Back to top

Image: Bigstock

Four Corners Continues Acquisition Spree, Adds Two Properties

Read MoreHide Full Article

Four Corners Property Trust (FCPT - Free Report) is on an acquisition spree and recently shelled out $3.8 million for the acquisition of a Texas Roadhouse property and $3.2 million for the purchase of a LongHorn Steakhouse property from Darden Restaurants (DRI - Free Report) through a sale-leaseback.

The Texas Roadhouse property is corporate operated, occupied under a triple-net lease with roughly 15 years of residual term. The property, positioned in a robust retail corridor in Illinois, is likely to keep witnessing solid demand. Moreover, the buyout seems a strategic one, with the transaction being priced at a 6.3% going-in cash capitalization rate (excluding transaction costs).

The LongHorn Steakhouse property in Florida is occupied under a triple-net lease, with roughly five years of residual term and annual rent increases of 1.5%.  The transaction is priced at a cap rate in range with its previous transactions.

Primarily engaged in the ownership of high-quality net-leased restaurant properties, Four Corners maintains an investment-grade financial position. The company seeks attractive acquisition opportunities to grow its portfolio with real estate catering to restaurant and retail industries. Apart from the above-mentioned acquisitions, the company has shelled out $ 2.1 million for Chick-fil-A restaurant property from Washington Prime Group.

While the pandemic has hit the restaurant as well as the retail industry hard, the reopening of economy is boosting hopes and things are now looking better compared with late March, thanks to the recovery in sales. In addition, as of Jul 29, 2020, the company managed to collect July, June, May and April rent payments, totaling  99%, 91%, 90% and 95%, respectively, of its portfolio’s contractual base rent for those months. Furthermore, the company’s acquisitions are expected to drive growth over the long term.

Shares of this Zacks Rank #2 (Buy) company have appreciated 51.2% over the past six months, while its industry has rallied 30.3%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

 

Other Stocks to Consider

Alpine Income Property Trust, Inc.’s (PINE - Free Report) Zacks Consensus Estimate for the ongoing-year funds from operations (FFO) per share moved 2.6% north to $1.18 in the past month. The stock currently carries a Zacks Rank of 2.

Sabra Healthcare REIT, Inc.’s (SBRA - Free Report) FFO per share estimate for 2020 has been revised 1.8% upward to $1.74 over the past month. The company currently carries a Zacks Rank of 2.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

Today, See These 5 Potential Home Runs >>

Published in