Mid-America Apartment Communities (MAA Quick QuoteMAA - Free Report) — commonly known as MAA — is a real estate investment trust (REIT) that focuses on owning, operating and acquiring apartment communities throughout the Southeast, Southwest and Mid-Atlantic regions of the United States. The company is slated to report second-quarter 2025 results on July 30, after market close.

In the last reported quarter, this Germantown, TN-based residential REIT reported core FFO per share of $2.20, which surpassed the Zacks Consensus Estimate of $2.16. Results reflected healthy demand and an occupancy rise. The REIT witnessed low levels of resident turnover.

Over the trailing four quarters, MAA surpassed the Zacks Consensus Estimate on three occasions and missed in the other period, the average beat being 0.92%. This is depicted in the chart below:

Mid-America Apartment Communities, Inc. Price and EPS Surprise

Mid-America Apartment Communities, Inc. price-eps-surprise | Mid-America Apartment Communities, Inc. Quote

Let’s see how things have shaped up before this announcement.

U.S. Apartment Market in Q2

The U.S. apartment market remained impressively resilient in the quarter under review, absorbing more than 227,000 units between April and June, a robust second-quarter figure. According to RealPage data, annual absorption surpassed even the peak leasing surge of 2021 and early 2022, defying a backdrop of slowing job growth, weak business sentiment and broader economic uncertainty.

While rent growth stayed muted, up just 0.19% in June, occupancy climbed steadily. At 95.6% in June, national occupancy rose 140 basis points year over year. Operators appear focused on maximizing occupancy, even if it means sacrificing rent increases. This “heads-in-beds” approach supports stability during a period of high new supply.

Supply, though moderating, remains historically elevated. More than 535,000 units were completed in the past year, with roughly 108,000 delivered in the second quarter alone. Yet, the market’s ability to digest this volume underscores its underlying strength.

Regionally, tech-driven markets like San Francisco and San Jose, as well as Boston and New York, gained momentum — likely aided by easing supply and increased return-to-office trends. Sun Belt markets, such as Dallas, Atlanta and Jacksonville, FL, also showed signs of recovery in the second quarter, sustaining robust demand amid declining deliveries. Tourism-dependent cities, like Las Vegas, Orlando, FL, and Nashville, TN, faltered slightly, possibly reflecting softening discretionary spending. Supply-heavy markets like Austin, Phoenix and Denver continued to see the sharpest rent cuts.

Factors to Consider Ahead of MAA’s Upcoming Results

MAA’s broad exposure to the Sunbelt region likely benefited from strong rental demand across its markets. The region's pro-business environment, attractive tax structure and relatively lower urban density support job creation and population inflows, contributing to sustained leasing momentum. The company is also expected to have benefited from its portfolio revamp efforts.

Nevertheless, elevated new supply in several Sunbelt markets may have limited MAA’s capacity to push rents or enhance occupancy in the second quarter. Furthermore, high interest rates continue to weigh on the company by increasing borrowing costs, which could hinder its acquisition and development plans.

Projections for MAA

Per the June presentation, from the beginning of the first quarter through May 30, 2025, MAA’s average daily physical occupancy was 95.5%, slightly below 95.6% in both the first quarter of 2025 and in the fourth quarter of 2024.

Also, from the beginning of 2025 through May 30, the same-store effective lease-over-lease average pricing change for new leases was a decline of 5.5% compared with a fall of 6.3% in the first quarter and a decline of 8.1% in the fourth quarter. For renewals, it was up 4.6% for the period, compared with 4.5% in the first quarter and 4.2% in the fourth quarter, resulting in a blended lease rate of 0.0% for the said period, compared with a decline of 0.5% for the first quarter and a fall of 2.1% in the fourth quarter.

The Zacks Consensus Estimate for quarterly revenues is pegged at $552.21 million. This suggests a 1.06% rise from the year-ago quarter’s reported figure.

For the second quarter, we expect same-store property net operating income to fall 0.6% year over year. Meanwhile, we project an average physical occupancy of 95.8%, up 20 basis points from the prior quarter. Moreover, our estimate indicates an 8.3% year-over-year increase in the company’s interest expenses.

MAA projected second-quarter 2025 core FFO per share in the band of $2.05-$2.21, with $2.13 at the midpoint. Before the second-quarter earnings release, the company’s activities were not adequate to gain analysts’ confidence. The Zacks Consensus Estimate for the quarterly core FFO per share has been revised a cent south to $2.15 in the past month. This also suggests a year-over-year decline of 3.15%.

Here is What Our Quantitative Model Predicts for MAA

Our proven model does not conclusively predict a surprise in terms of FFO per share for MAA this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an FFO beat, which is not the case here.

MAA currently carries a Zacks Rank of 4 (Sell) and has an Earnings ESP of -0.32%.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks That Warrant a Look

Here are two stocks from the residential REIT sector, American Homes 4 Rent (AMH Quick QuoteAMH - Free Report) and Independence Realty Trust, Inc. (IRT Quick QuoteIRT - Free Report) , you may want to consider as our model shows that these have the right combination of elements to report an FFO beat this quarter.

American Homes 4 Rent, scheduled to report quarterly numbers on July 31, has an Earnings ESP of +0.33% and carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Independence Realty Trust is slated to report quarterly numbers on July 30. IRT has an Earnings ESP of +0.79% and carries a Zacks Rank of 3 at present.

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.