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UDR to Report Q1 Earnings: What's in Store for the Stock?
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UDR Inc. (UDR - Free Report) is slated to report first-quarter 2020 results on May 6, after the bell. The company’s performance is expected to reflect year-over-year growth in revenues and funds from operations (FFO) per share.
In the last reported quarter, this Denver, CO-based residential real estate investment trust (REIT) delivered an in-line performance in terms of FFO per share. Results reflected year-over-year growth in same-store net operating income (NOI) and weighted average same-store physical occupancy.
In the trailing four quarters, the company surpassed the Zacks Consensus Estimate on one occasion and met expectations in the other three, delivering an average positive surprise of 0.50%.
United Dominion Realty Trust, Inc. Price and EPS Surprise
Let’s see how things have shaped up for this announcement.
Factors to Consider
Though the coronavirus pandemic jeopardized the second half of the January-March period, the quarter had commenced on a positive note with a resilient economy and decent job-market strength. Therefore, the pandemic’s impact is likely to be more pronounced on real estate fundamentals in the second quarter than in the first.
Usually, demand for apartments slows down during the colder months as renters usually prefer less to move in winters. However, per a report from real estate technology and analytics firm RealPage, the U.S. apartment rental market’s performance in February was steady with national apartment occupancy in the month remaining at 95.5%, in line with January’s and up 30 basis points (bps) from the year-ago tally. Rent growth of 2.9% was also in line with the three-year average.
Banking on the favorable rental housing trend, UDR has been focused on enhancing its overall portfolio by acquiring, developing and re-developing properties in core operating markets and divesting the company’s non-core assets. Moreover, favorable demographics, household formation and job-market gains are anticipated to have been key demand drivers for the company’s properties in the quarter under consideration.
UDR has also been steadily implementing its Next Generation operating platform consisting of SmartHome installations and other infrastructure buildouts. These efforts are expected to have boosted its margin and supported the company’s operational platform during the March-end quarter.These, in turn, are likely to have supported UDR’s performance in the quarter. Moreover, these efforts are likely to have provided the company a competitive edge over others as social distancing has become essential to contain the spread of coronavirus.
Late in March, UDR also announced that it expects its first-quarter results to be in line with the previously-issued guidance. Supporting its balance-sheet strength, the company’s unencumbered asset pool comprises 87.5% of total net operating income and as of Mar 25, 2020, UDR had minimal external growth funding commitments with a development pipeline comprising less than 2% of enterprise value.
The Zacks Consensus Estimate for first-quarter revenues is currently pegged at $310.4 million, indicating 15.8% year-over-year growth.
However, new supply of apartment properties was elevated in the quarter under review in a number of the company’s markets. Therefore, we remain apprehensive about UDR’s performance as elevated levels of supply limit landlords’ ability to demand more rents, result in lesser absorption and lead to increased concession activities. Particularly, new lease rate growth might have been adversely impacted.
Also, prior to the first-quarter earnings release, there is lack of any solid catalyst for becoming optimistic about the company’s prospects. As such, the Zacks Consensus Estimate for the January-March quarter FFO per share remained unchanged at 54 cents, over the past 30 days. Nonetheless, it suggests year-over year growth of 5.9%. The company projects FFO as adjusted per share at 53-55 cents.
Here is what our quantitative model predicts:
Our proven model does not conclusively predict a positive surprise in terms of FFO per share for UDR this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of a FFO beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
UDR currently carries a Zacks Rank #2 and has an Earnings ESP of 0.00%.
Stocks That Warrant a Look
Here are a few stocks in the REIT sector that you may want to consider, as our model shows that these have the right combination of elements to report a positive surprise this quarter:
Extra Space Storage Inc. (EXR - Free Report) , slated to release first-quarter earnings on May 6, has an Earnings ESP of +0.17% and carries a Zacks Rank of 3 at present.
Americold Realty Trust (COLD - Free Report) , scheduled to announce earnings results on May 7, has an Earnings ESP of +9.74% and currently holds a Zacks Rank #3.
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.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Image: Bigstock
UDR to Report Q1 Earnings: What's in Store for the Stock?
UDR Inc. (UDR - Free Report) is slated to report first-quarter 2020 results on May 6, after the bell. The company’s performance is expected to reflect year-over-year growth in revenues and funds from operations (FFO) per share.
In the last reported quarter, this Denver, CO-based residential real estate investment trust (REIT) delivered an in-line performance in terms of FFO per share. Results reflected year-over-year growth in same-store net operating income (NOI) and weighted average same-store physical occupancy.
In the trailing four quarters, the company surpassed the Zacks Consensus Estimate on one occasion and met expectations in the other three, delivering an average positive surprise of 0.50%.
United Dominion Realty Trust, Inc. Price and EPS Surprise
United Dominion Realty Trust, Inc. price-eps-surprise | United Dominion Realty Trust, Inc. Quote
Let’s see how things have shaped up for this announcement.
Factors to Consider
Though the coronavirus pandemic jeopardized the second half of the January-March period, the quarter had commenced on a positive note with a resilient economy and decent job-market strength. Therefore, the pandemic’s impact is likely to be more pronounced on real estate fundamentals in the second quarter than in the first.
Usually, demand for apartments slows down during the colder months as renters usually prefer less to move in winters. However, per a report from real estate technology and analytics firm RealPage, the U.S. apartment rental market’s performance in February was steady with national apartment occupancy in the month remaining at 95.5%, in line with January’s and up 30 basis points (bps) from the year-ago tally. Rent growth of 2.9% was also in line with the three-year average.
Banking on the favorable rental housing trend, UDR has been focused on enhancing its overall portfolio by acquiring, developing and re-developing properties in core operating markets and divesting the company’s non-core assets. Moreover, favorable demographics, household formation and job-market gains are anticipated to have been key demand drivers for the company’s properties in the quarter under consideration.
UDR has also been steadily implementing its Next Generation operating platform consisting of SmartHome installations and other infrastructure buildouts. These efforts are expected to have boosted its margin and supported the company’s operational platform during the March-end quarter.These, in turn, are likely to have supported UDR’s performance in the quarter. Moreover, these efforts are likely to have provided the company a competitive edge over others as social distancing has become essential to contain the spread of coronavirus.
Late in March, UDR also announced that it expects its first-quarter results to be in line with the previously-issued guidance. Supporting its balance-sheet strength, the company’s unencumbered asset pool comprises 87.5% of total net operating income and as of Mar 25, 2020, UDR had minimal external growth funding commitments with a development pipeline comprising less than 2% of enterprise value.
The Zacks Consensus Estimate for first-quarter revenues is currently pegged at $310.4 million, indicating 15.8% year-over-year growth.
However, new supply of apartment properties was elevated in the quarter under review in a number of the company’s markets. Therefore, we remain apprehensive about UDR’s performance as elevated levels of supply limit landlords’ ability to demand more rents, result in lesser absorption and lead to increased concession activities. Particularly, new lease rate growth might have been adversely impacted.
Also, prior to the first-quarter earnings release, there is lack of any solid catalyst for becoming optimistic about the company’s prospects. As such, the Zacks Consensus Estimate for the January-March quarter FFO per share remained unchanged at 54 cents, over the past 30 days. Nonetheless, it suggests year-over year growth of 5.9%. The company projects FFO as adjusted per share at 53-55 cents.
Here is what our quantitative model predicts:
Our proven model does not conclusively predict a positive surprise in terms of FFO per share for UDR this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of a FFO beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
UDR currently carries a Zacks Rank #2 and has an Earnings ESP of 0.00%.
Stocks That Warrant a Look
Here are a few stocks in the REIT sector that you may want to consider, as our model shows that these have the right combination of elements to report a positive surprise this quarter:
SBA Communications Corporation (SBAC - Free Report) , set to report quarterly numbers on May 5, has an Earnings ESP of +0.67% and carries a Zacks Rank of 3 currently. You can see the complete list of today’s Zacks #1 Rank stocks here.
Extra Space Storage Inc. (EXR - Free Report) , slated to release first-quarter earnings on May 6, has an Earnings ESP of +0.17% and carries a Zacks Rank of 3 at present.
Americold Realty Trust (COLD - Free Report) , scheduled to announce earnings results on May 7, has an Earnings ESP of +9.74% and currently holds a Zacks Rank #3.
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.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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