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Why Is PS Business Parks (PSB) Up 2% Since Last Earnings Report?

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A month has gone by since the last earnings report for PS Business Parks (PSB - Free Report) . Shares have added about 2% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is PS Business Parks 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 drivers.

PS Business Parks Q1 FFO Beats on Rental Rate Growth

PS Business Parks reported first-quarter 2019 core FFO of $1.67 per share, beating the Zacks Consensus Estimate by a penny. Also, the figure improved 5% from the prior-year quarter’s level of $1.59.    

Results highlight improvement in Same-Park NOI backed by growth in rental rates and occupancy, as well as improved NOI from non-Same-Park and multi-family assets. However, NOI reduction due to facilities sold in 2018 partly offset the positives.

Rental income came in at around $107.8 million, marking 3.9% growth from the year-ago quarter tally. The reported figure also exceeded the Zacks Consensus Estimate of $103.1 million.

Quarter in Detail

Same-Park rental income was up 4.3% year over year to $102.8 million, while Same-Park NOI climbed 4.3% year over year to $71.8 million, driven by improving rental rates and occupancy level.

Same-Park annualized revenue per occupied-square-foot increased 4% to $16.04, while weighted average square-foot occupancy was 94.5%, up 30 basis points year over year.

Liquidity

PS Business Parks exited first-quarter 2019 with cash and cash equivalents of $39.4 million, up from $37.4 million reported at the end of 2018.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in fresh estimates.

VGM Scores

Currently, PS Business Parks has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. Charting a somewhat similar path, 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 F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. It comes with little surprise PS Business Parks has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.


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