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PS Business Parks (PSB) Up 1.3% Since Earnings Report: Can It Continue?

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It has been about a month since the last earnings report for PS Business Parks, Inc. (PSB - Free Report) . Shares have added about 1.3% in that time frame.

Will the recent positive trend continue leading up to its next earnings release, or is PSB due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

PS Business Parks Q1 FFO & Revenues Beat Estimates

PS Business Parks reported first-quarter 2018 FFO of $1.59 per share, beating the Zacks Consensus Estimate of $1.50. The figure also came in 4.6% higher than $1.52 recorded in the prior-year quarter.

Results highlight a rise in Same-Park NOI that was backed by growth in rental rates.

Rental income came in around $103.8 million, marking 3.7% growth from the year-ago figure. Additionally, the figure outpaced the Zacks Consensus Estimate of $100.6 million.

Quarter in Detail

Same-Park rental income was up 2.4% year over year, while Same-Park NOI edged up 0.7% year over year, mainly driven by improving rental rates.

Same-Park annualized rental income per occupied-square-foot rose 2.3% to $15.40, while weighted average square-foot occupancy was 94.6%, flat year over year.

Liquidity

PS Business Parks exited first-quarter 2018 with cash and cash equivalents of $39.2 million, down from $114.9 million at the end of the prior quarter.

Portfolio Update

During the first quarter, the company sold Corporate Pointe Business Park in Orange County, CA — consisting of five multi-tenant office buildings and aggregating 161,000 square feet of space — for net proceeds of $41.7 million. Following the end of the quarter, the company accomplished the sale of Orange County Business Center, which comprises five multi-tenant office buildings, spanning 437,000 square feet of space, for $73.3 million.

The company plans selling additional 107,000 rentable square feet of office product in Orange County, CA, as well as 194,000 square feet of flex product in Dallas, TX, in 2018.

Dividend Update

On Apr 24, the company announced a regular quarterly dividend of 85 cents per share, same as the previous payout. The dividend is payable on Jun 28, to shareholders of record as of Jun 13, 2018.

How Have Estimates Been Moving Since Then?

Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.

VGM Scores

Currently, PSB has a subpar Growth Score of D. Its Momentum is doing a lot better with a B. However, the stock was also allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

The company's stock is suitable solely for momentum based on our styles scores.

Outlook

PSB has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.




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