Essex Property Trust, Inc. (ESS Quick QuoteESS - Free Report) is scheduled to report its fourth-quarter and full-year 2025 results on Feb. 4, after market close. The company’s quarterly results are likely to reflect year-over-year growth in revenues and core funds from operations (FFO) per share.

In the last reported quarter, this San Mateo, CA-based residential real estate investment trust (REIT) delivered a surprise of 0.25% in terms of core FFO per share. Results reflected favorable growth in same-property revenues and net operating income (“NOI”). However, higher same-property operating expenses and interest expenses partly acted as a dampener.

Over the trailing four quarters, Essex Property’s earnings surpassed the Zacks Consensus Estimate on each occasion, the average surprise being 0.76%. The graph below depicts the surprise history of the company:

Essex Property Trust, Inc. Price and EPS Surprise

Essex Property Trust, Inc. price-eps-surprise | Essex Property Trust, Inc. Quote

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

US Apartment Market in Q4

Apartment REIT fundamentals softened in fourth-quarter 2025 as the sector normalized from the exceptional demand of recent years. According to the RealPage report, the market recorded net move-outs of about 40,400 units during the quarter, marking the first seasonal pullback in three years. Full-year absorption totaled just over 365,900 units, signaling a return toward long-term leasing trends rather than a demand collapse.

Supply remains the primary pressure point. Approximately 409,500 units were delivered in 2025, including about 89,400 in the fourth quarter, keeping competition elevated despite a sequential slowdown in completions. As a result, occupancy slipped to 94.8%, while effective asking rents declined 1.7% quarter over quarter. Rents declined 0.6% in calendar 2025, extending the year-over-year downturn for a second consecutive quarter. Concessions expanded meaningfully, with more than 23% of units offering incentives averaging 7%, reflecting REITs’ focus on protecting occupancy and cash flow.

Market performance remains uneven. Supply-heavy Sun Belt markets such as Austin, Phoenix and Denver experienced the steepest rent pressure, while coastal and tech-oriented metros, including New York and San Francisco, continued to post modest rent growth due to tighter supply.

Factors to Consider Ahead of ESS’ Upcoming Results

Essex Property stands to benefit from its significant West Coast concentration, a region anchored by technology and innovation-led employers that support job growth and rising incomes. The market features higher-than-average household incomes, a larger renter base and favorable demographic trends. Elevated home prices continue to limit homeownership affordability, extending renter tenures and reinforcing apartments as a practical and flexible housing choice.

Still, Essex Property is likely to have faced leasing challenges in the fourth quarter, as pockets of elevated supply are likely to have weighed on rent growth and occupancy. At the same time, higher interest expenses are expected to have persisted on a year-over-year basis, continuing to pressure earnings.

Projections for ESS’ Q4 Results

The Zacks Consensus Estimate of $476.57 million for fourth-quarter revenues calls for a 4.86% increase year over year. The consensus estimate for same-property revenues is pegged at $414.75 million, marginally up from $411.23 million in the year-ago period. The consensus mark for same-property financial occupancies is currently pegged at 96.00%, slightly below the prior quarter’s 96.1%.

For the fourth quarter of 2025, Essex Property projected core FFO per share in the range of $3.93-$4.03. Before the fourth-quarter earnings release, Essex Property’s activities were inadequate to gain analysts’ confidence. The Zacks Consensus Estimate for the quarterly core FFO per share has remained unrevised in the past month at $4.00. However, it indicates a year-over-year increase of 2.04%. 

For full-year 2025, the company projected core FFO per share in the range of $15.89-$15.99, with the midpoint being $15.94. The full-year guidance is based on projections for the same-property revenue growth of 3.00-3.30%, an operating expense increase of 3.00-3.50% and a NOI expansion of 2.80-3.40%.

For full-year 2025, the Zacks Consensus Estimate for core FFO per share is pegged at $15.97. The figure indicates a 2.37% increase year over year on revenues of $1.88 billion.

What Our Quantitative Model Predicts for ESS Stock

Our proven model does not conclusively predict a surprise in terms of core FFO per share for Essex Property 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. 

Essex Property currently carries a Zacks Rank of 4 (Sell) and has an Earnings ESP of -0.69%. 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 — Equity Residential (EQR Quick QuoteEQR - Free Report) and UDR Inc. (UDR Quick QuoteUDR - Free Report) — that you may want to consider, as our model shows that these have the right combination of elements to report a surprise this quarter.

Equity Residential, scheduled to report quarterly numbers on Feb. 5, has an Earnings ESP of +0.64% and carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

UDR is likely to report quarterly numbers around Feb. 4. It has an Earnings ESP of +0.74% 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.