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Vornado (VNO) to Post Q3 Earnings: What's in the Offing?
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Vornado Realty Trust (VNO - Free Report) is scheduled to report third-quarter 2021 results on Nov 1, after the closing bell. The quarterly results are projected to display growth in revenues and funds from operations (FFO) per share.
In the last reported quarter, the FFO per share came in line with the Zacks Consensus Estimate for this New York-based real estate investment trust (REIT). The company’s results reflected year-over-year growth in the same-store NOI in the New York portfolio, theMART and 555 California Street.
Over the trailing four quarters, Vornado’s results surpassed the Zacks Consensus Estimate on two occassions, missed in one and came in line in the other, the average negative beat being 0.38%.
Let’s see how things have shaped up prior to this announcement.
The pandemic’s impact on the labor markets continued to overwhelm the U.S. office real estate market in the quarter to be reported, resulting in a negative net absorption and an increase in vacancy levels. The remote-working wave is still continuing and though the office-using employment is recovering, it is below the pre-pandemic level.
Going by a Cushman & Wakefield (CWK - Free Report) report, the U.S. office sector witnessed a negative net absorption of 18.3 million square feet during the third quarter, marking the sixth consecutive quarter of negative absorption. Also, the vacancy rate increased to 17.4% during the September-end quarter from the prior-year quarter’s 14.3%.
However, Vornado’s premium assets in a few select high-rent, high barrier-to-entry markets and improvement in the office market are likely to have aided cash flow and fueled revenue growth. Moreover, the company’s focus on expanding its market share in the New York City office real estate is likely to have aided its performance.
In sync with this strategy, in August, the company completed the acquisition of Canada Pension Plan Investment Board’s (CPP Investments) 45% interest in One Park Avenue pursuant to a right of first offer.
While the reopening of the economy and consumers’ desire to return to physical retail spaces are likely to have aided the company’s retail tenants, limitations on international travel and a number of other factors might have affected the growth tempo.
Amid these, in August, Vornado signed agreements to sell five Manhattan retail properties for $184.5 million. With the properties witnessing negative income and street-level occupancy of nearly 30%, the disposition move seemed a strategic fit.
The Zacks Consensus Estimate for the company’s New York property rentals is pegged at $243 million. This indicates a marginal increase from the prior-year quarter reported figure.
The Zacks Consensus Estimate for third-quarter revenues is pegged at $365.8 million, suggesting marginal year-over-year growth.
Prior to the quarterly earnings release, analysts seem to be optimistic about the company’s prospects, as the Zacks Consensus Estimate for the July-September quarter’s FFO per share moved 1.4% north to 72 cents over the past two months.
Earnings Whispers
Per our quantitative model, Vornado does not have the right combination of the two key ingredients — a positive Earnings ESP and Zacks Rank #3 (Hold) or higher — for increasing the odds of a FFO beat this quarter.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: Vornado has an Earnings ESP of -0.84%.
Zacks Rank: The company currently carries a Zacks Rank of 2 (Buy).
Stocks That Warrant a Look
Here are a few stocks in the REIT sector that you may want to consider, as our model shows that these have the right combination of elements to report a beat this quarter:
CoreSite Realty Corporation (COR - Free Report) , scheduled to report quarterly numbers on Oct 28, currently has an Earnings ESP of +1.86% and carries a Zacks Rank of 2.
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.
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Vornado (VNO) to Post Q3 Earnings: What's in the Offing?
Vornado Realty Trust (VNO - Free Report) is scheduled to report third-quarter 2021 results on Nov 1, after the closing bell. The quarterly results are projected to display growth in revenues and funds from operations (FFO) per share.
In the last reported quarter, the FFO per share came in line with the Zacks Consensus Estimate for this New York-based real estate investment trust (REIT). The company’s results reflected year-over-year growth in the same-store NOI in the New York portfolio, theMART and 555 California Street.
Over the trailing four quarters, Vornado’s results surpassed the Zacks Consensus Estimate on two occassions, missed in one and came in line in the other, the average negative beat being 0.38%.
Vornado Realty Trust Price and EPS Surprise
Vornado Realty Trust price-eps-surprise | Vornado Realty Trust Quote
Let’s see how things have shaped up prior to this announcement.
The pandemic’s impact on the labor markets continued to overwhelm the U.S. office real estate market in the quarter to be reported, resulting in a negative net absorption and an increase in vacancy levels. The remote-working wave is still continuing and though the office-using employment is recovering, it is below the pre-pandemic level.
Going by a Cushman & Wakefield (CWK - Free Report) report, the U.S. office sector witnessed a negative net absorption of 18.3 million square feet during the third quarter, marking the sixth consecutive quarter of negative absorption. Also, the vacancy rate increased to 17.4% during the September-end quarter from the prior-year quarter’s 14.3%.
However, Vornado’s premium assets in a few select high-rent, high barrier-to-entry markets and improvement in the office market are likely to have aided cash flow and fueled revenue growth. Moreover, the company’s focus on expanding its market share in the New York City office real estate is likely to have aided its performance.
In sync with this strategy, in August, the company completed the acquisition of Canada Pension Plan Investment Board’s (CPP Investments) 45% interest in One Park Avenue pursuant to a right of first offer.
While the reopening of the economy and consumers’ desire to return to physical retail spaces are likely to have aided the company’s retail tenants, limitations on international travel and a number of other factors might have affected the growth tempo.
Amid these, in August, Vornado signed agreements to sell five Manhattan retail properties for $184.5 million. With the properties witnessing negative income and street-level occupancy of nearly 30%, the disposition move seemed a strategic fit.
The Zacks Consensus Estimate for the company’s New York property rentals is pegged at $243 million. This indicates a marginal increase from the prior-year quarter reported figure.
The Zacks Consensus Estimate for third-quarter revenues is pegged at $365.8 million, suggesting marginal year-over-year growth.
Prior to the quarterly earnings release, analysts seem to be optimistic about the company’s prospects, as the Zacks Consensus Estimate for the July-September quarter’s FFO per share moved 1.4% north to 72 cents over the past two months.
Earnings Whispers
Per our quantitative model, Vornado does not have the right combination of the two key ingredients — a positive Earnings ESP and Zacks Rank #3 (Hold) or higher — for increasing the odds of a FFO beat this quarter.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: Vornado has an Earnings ESP of -0.84%.
Zacks Rank: The company currently carries a Zacks Rank of 2 (Buy).
Stocks That Warrant a Look
Here are a few stocks in the REIT sector that you may want to consider, as our model shows that these have the right combination of elements to report a beat this quarter:
Apple Hospitality REIT (APLE - Free Report) , slated to release third-quarter earnings on Nov 4, has an Earnings ESP of +26.67% and sports a Zacks Rank of 1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
CoreSite Realty Corporation (COR - Free Report) , scheduled to report quarterly numbers on Oct 28, currently has an Earnings ESP of +1.86% and carries a Zacks Rank of 2.
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.