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Highwoods Properties (HIW) Down 1.3% Since Last Earnings Report: Can It Rebound?

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A month has gone by since the last earnings report for Highwoods Properties (HIW - Free Report) . Shares have lost about 1.3% in that time frame, underperforming the S&P 500.

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

Highwoods Properties’ Q4 FFO Meets Estimates, Up Y/Y

Highwoods reported fourth-quarter 2018 FFO of 86 cents per share, meeting the Zacks Consensus Estimate. The figure also compared favorably with the year-ago tally of 84 cents.

Results indicated growth in average in-place office cash rent per square foot and GAAP rent for second-generation office space. Additionally, the company witnessed growth in same-property cash NOI.

Rental and other revenues of $181.4 million surpassed the Zacks Consensus Estimate of $179.3 million. Further, the reported figure outpaced the year-earlier tally of $175.9 million.

Quarter in Detail

Highwoods leased 918,000 square feet of second-generation office space during the fourth quarter. Moreover, same-property cash NOI inched up 1.5% year over year.

At the end of the quarter under review, the company’s development pipeline totaled $691 million and was 92.9% pre-leased. During the quarter, the company placed an industrial property worth $8 million in service, which is 100% occupied. In addition, Highwoods sold non-core assets, spanning 323,000 square feet, for $54.5 million.

Notably, it did not issue any shares under the ATM program.

As of Dec 31, 2018, Highwoods had around $3.8 million of cash and cash-equivalents compared with $3.3 million reported as of Dec 31, 2017.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in fresh estimates.

VGM Scores

At this time, Highwoods Properties has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Following the exact same course, the stock was 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.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Highwoods Properties has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.




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