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Federal Realty (FRT) Q1 FFO Beats Estimates, Revenues Up Y/Y

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Retail REIT — Federal Realty Investment Trust (FRT - Free Report) — posted first-quarter 2019 funds from operations (FFO) per share of $1.56, which beat the Zacks Consensus Estimate by penny. The reported figure has also improved from the prior-year tally of $1.52.

Results reflect rise in property operating income and lease rollover for comparable properties.

Total revenues grew 3% year over year to $232.2 million. However, the top line missed the Zacks Consensus Estimate of $234.7 million.

Quarter in Details

During the reported quarter, Federal Realty signed 79 leases for 305,724 square feet of retail space. On a comparable space basis, the company leased 247,331 square feet at average rent of $45.07 per square foot. This denoted cash-basis rollover growth of 10%.

As of Mar 31, 2019, the company’s overall portfolio was 94.0%, down 80 basis points (bps) year over year. As of that date, comparable property portfolio was 94.6% leased, down 90 bps from the prior-year period. In addition, property operating income (POI) for comparable properties climbed 3.5% in the first quarter.

Federal Realty exited first-quarter 2019 with cash and cash equivalents of approximately $43.0 million, down from $64.1 million posted at the end of 2018.

Outlook

For 2019, Federal Realty maintained FFO per share guidance at $6.30-$6.46. The Zacks Consensus Estimate for the same is currently pinned at $6.39, within the company’s guided range.

Dividend Update

Federal Realty announced a quarterly cash dividend of $1.02 per share. The dividend will be paid on Jul 15, to shareholders on record as of Jun 21, 2019.

Our Take

Federal Realty’s premium retail real estate assets, diverse tenant base and focus on mixed used properties position it well for long-term growth. In addition, the company’s robust balance sheet offers scope for growth. Also, it has enabled the company to raise dividends for 51 straight years. However, shrinking footfall at malls amid shift of consumers toward online channels, store closures and bankruptcy of retailers will likely continue to affect the performance of this retail REIT.

Federal Realty currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Federal Realty Investment Trust Price, Consensus and EPS Surprise
 

Federal Realty Investment Trust Price, Consensus and EPS Surprise | Federal Realty Investment Trust Quote

We now look forward to the earnings reports of REITs like Omega Healthcare Investors, Inc. (OHI - Free Report) , Senior Housing Properties Trust and Plymouth Industrial REIT, Inc. (PLYM - Free Report) , which are slated for release next week.

Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.


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