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What to Expect from Alexandria's (ARE) Q3 Earnings Report?
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AlexandriaReal Estate Equities (ARE - Free Report) is slated to report third-quarter 2017 results on Oct 30, after the market closes. While the company’s funds from operations (FFO) per share are anticipated to be up year over year, revenues might decline.
In the prior quarter, this Pasadena, CA-based urban office real estate investment trust (REIT), which primarily focuses on collaborative life science and technology campuses, delivered in-line FFO per share.
Over the trailing four quarters, the company beat the Zacks Consensus Estimate in two occasions, met in one and missed in the other, with an average beat of 0.35%.
Alexandria’s shares have climbed 9.5% year to date, outperforming the industry’s gain of 3.3%.
Note: All EPS numbers presented here represent funds from operations (FFO) per share.
Let’s see how things have shaped up for this announcement.
Factors to Consider
Alexandria focuses on Class A properties concentrated in urban campuses, primarily for the life science and technology entities. These locations are characterized by high barriers to entry and exit, and a limited supply of available space. This highly dynamic setting adds to the productivity and efficiency of the tenants, and will enable the company to enjoy steady rental revenues in the third quarter.
The company follows the strategy of rotating capital from high-value assets, and the sale of non-core operating assets and non-strategic land parcels in order to finance pre-leased value-creation development and redevelopment projects. The near-term dilution impact of such moves is anticipated to weigh on its third-quarter earnings.
In addition, Alexandria’s exposure to Canada and Asia through its subsidiaries makes it susceptible to currency fluctuation risks. In the to-be-reported quarter too, we expect unfavorable currency fluctuations to dent the company’s bottom-line performance.
Also, over the past month, the Zacks Consensus Estimate of FFO per share for the third quarter remained unchanged at $1.50, reflecting lack of any solid catalyst for being positive on the stock’s expected performance.
Earnings Whispers
Our proven model does not conclusively show that Alexandria will likely beat estimates this season. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold) for this to happen. However, that is not the case here as you will see below.
(You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.)
Zacks ESP: The Earnings ESP for Alexandria is 0.00%.
Zacks Rank: Alexandria currently has a Zacks Rank #4 (Sell), which actually reduces the predictive power of ESP.
Stocks That Warrant a Look
Here are a few stocks in the REIT space that you may want to consider, as our model shows that these have the right combination of elements to report a positive surprise this time around:
BostonProperties, Inc. (BXP - Free Report) , slated to release third-quarter earnings on Nov 1, has an Earnings ESP of +0.5% and a Zacks Rank of 3.
Welltower Inc , slated to release third-quarter results on Nov 7, has an Earnings ESP of +0.06% and a Zacks Rank of 3.
Note: FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Image: Bigstock
What to Expect from Alexandria's (ARE) Q3 Earnings Report?
AlexandriaReal Estate Equities (ARE - Free Report) is slated to report third-quarter 2017 results on Oct 30, after the market closes. While the company’s funds from operations (FFO) per share are anticipated to be up year over year, revenues might decline.
In the prior quarter, this Pasadena, CA-based urban office real estate investment trust (REIT), which primarily focuses on collaborative life science and technology campuses, delivered in-line FFO per share.
Over the trailing four quarters, the company beat the Zacks Consensus Estimate in two occasions, met in one and missed in the other, with an average beat of 0.35%.
Alexandria’s shares have climbed 9.5% year to date, outperforming the industry’s gain of 3.3%.
Note: All EPS numbers presented here represent funds from operations (FFO) per share.
Let’s see how things have shaped up for this announcement.
Factors to Consider
Alexandria focuses on Class A properties concentrated in urban campuses, primarily for the life science and technology entities. These locations are characterized by high barriers to entry and exit, and a limited supply of available space. This highly dynamic setting adds to the productivity and efficiency of the tenants, and will enable the company to enjoy steady rental revenues in the third quarter.
The company follows the strategy of rotating capital from high-value assets, and the sale of non-core operating assets and non-strategic land parcels in order to finance pre-leased value-creation development and redevelopment projects. The near-term dilution impact of such moves is anticipated to weigh on its third-quarter earnings.
In addition, Alexandria’s exposure to Canada and Asia through its subsidiaries makes it susceptible to currency fluctuation risks. In the to-be-reported quarter too, we expect unfavorable currency fluctuations to dent the company’s bottom-line performance.
Also, over the past month, the Zacks Consensus Estimate of FFO per share for the third quarter remained unchanged at $1.50, reflecting lack of any solid catalyst for being positive on the stock’s expected performance.
Earnings Whispers
Our proven model does not conclusively show that Alexandria will likely beat estimates this season. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold) for this to happen. However, that is not the case here as you will see below.
(You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.)
Zacks ESP: The Earnings ESP for Alexandria is 0.00%.
Zacks Rank: Alexandria currently has a Zacks Rank #4 (Sell), which actually reduces the predictive power of ESP.
Stocks That Warrant a Look
Here are a few stocks in the REIT space that you may want to consider, as our model shows that these have the right combination of elements to report a positive surprise this time around:
Extra Space Storage Inc. (EXR - Free Report) , slated to release third-quarter earnings on Nov 1, has an Earnings ESP of +1.31% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
BostonProperties, Inc. (BXP - Free Report) , slated to release third-quarter earnings on Nov 1, has an Earnings ESP of +0.5% and a Zacks Rank of 3.
Welltower Inc , slated to release third-quarter results on Nov 7, has an Earnings ESP of +0.06% and a Zacks Rank of 3.
Note: FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Click for details >>