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Lamar (LAMR) Q1 FFO Misses, Revenues Beat Estimates, Stock Up

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Lamar Advertising Company (LAMR - Free Report) reported funds from operations (FFO) per share of $1.12 for the first quarter, up 13.3% from the prior-year quarter’s 99 cents. However, the figure narrowly missed the Zacks Consensus Estimate of $1.13.

This year-over-year improvement reflects healthy net revenue growth.

Net revenues for the quarter came in at $406.6 million, marking a 5.8% increase from the prior-year quarter. Moreover, the revenue figure surpassed the Zacks Consensus Estimate of $390.2 million.

In addition, shares of Lamar Advertising appreciated 18.40% during Thursday’s regular trading session, reflecting upbeat investor sentiment.

Quarter in Detail

Acquisition-adjusted net revenues for the first quarter increased 4.4% year on year to $406.6 million, while acquisition-adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) grew 8.7% to $159.8 million.

Operating income improved 6.4% from the prior-year quarter to $96.6 million, while adjusted EBITDA went up 9.4% to $159.8 million. Additionally, free cash flow of $97.1 million in the March-end quarter improved 17.4% year over year.

Balance Sheet

At the end of first-quarter 2020, Lamar Advertising had total liquidity of $608.5 million, of which $111.9 million was available for borrowing under its revolving senior credit facility, and $496.6 million in cash and cash equivalents.

Further, the company made use of $535 million under its revolving credit facility to bolster liquidity. On Feb 6, 2020, the company completed a $2.35-billion refinancing transaction, consisting of the issuance of an additional $1 billion in new senior notes and restatement of senior credit facility.

The company also expects a fall in capital expenditure from $130 million to about $58 million this year.

Outlook

Lamar Advertising has withdrawn its 2020 guidance in the wake of the coronavirus crisis. It intends to reissue the guidance during the second-quarter earnings conference call in August.

The company had earlier projected 2020 AFFO per share of $6.05-$6.20, suggesting 4.3-7% year-over-year growth.

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

Lamar Advertising Company Price, Consensus and EPS Surprise

Lamar Advertising Company Price, Consensus and EPS Surprise

Lamar Advertising Company price-consensus-eps-surprise-chart | Lamar Advertising Company Quote

We now look forward to the earnings releases of other REITs like Simon Property Group, Inc. (SPG - Free Report) , Park Hotels & Resorts Inc. (PK - Free Report) and The Macerich Company (MAC - Free Report) . While Simon Property and Park Hotels & Resorts are slated to report quarterly numbers on May 11, The Macerich Company will release results on May 12.  

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

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