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Analysts’ views carry a significant weight on Wall Street. Investors often see share prices rise if an analyst upgrades a stock or maintains a previous rating while increasing the price target.
Sometimes, analysts review a particular sector or subsector and then increase price targets on multiple stocks within that group. Other times, when one analyst boosts a rating on a stock, another analyst soon follows suit.
Four real estate investment trusts (REITs) have just received new price targets from the Scotiabank analyst. Three have diversified portfolios, while the fourth is a retail REIT. Take a look:
WP Carey
WP Carey Inc. (NYSE:WPC) is a New York City-based diversified net-lease REIT, whose single-tenant properties include industrial, warehouse, retail and self-storage units. It was founded in 1973 and recently celebrated its 50th year of property investing.
WP Carey has 1,282 net-leased properties with approximately 168 million square feet across 26 countries. Its portfolio includes 335 tenants with a weighted average lease term of 14.9 years and an excellent occupancy rate of 99.1.
On April 30, WP Carey reported its Q1 2024 operating results, missing analysts’ estimates for both FFO and revenue. FFO of $1.14 per share and revenue of $386.842 million fell short of the expected $1.16 per share and $397.594 million. FFO was also below $1.31 in the same period a year ago and revenue decreased from $427.350 million in Q1 2023.
WP Carey also affirmed its full-year 2024 AFFO per share of $4.65 to $4.75, with a midpoint of $4.70, slightly above estimates of $4.67.
Despite missing estimates for the second consecutive quarter, the forward guidance gave investors hope and WP Carey shares have rallied since the earnings announcement.
On May 16, Scotiabank analyst Nicholas Yulico maintained WP Carey at Sector Perform and raised the price target by 9% from $55 to $60. However, WP Carey recently closed at $59.56, so the price target is hardly a ringing endorsement.
Many investors have also lost faith in WP Carey after its September announcement of a spinoff and sale of its office properties and a surprising dividend cut. Shares have fallen over 26% since the high of $81.54 in July 2022.
Ventas
Ventas Inc (NYSE:VTR) is a Chicago-based diversified health care REIT with 1,368 properties including senior living communities, life science, research and innovation properties, medical offices, outpatient facilities and skilled nursing facilities. Ventas has been in business for over 20 years and is a member of the S&P 500.
Ventas has been making news recently. On May 1, Ventas declared its Q1 2024 operating results. FFO of $0.78 per share beat the consensus estimate of $0.74 and Q1 2023 FFO of $0.74 per share. Revenue of $1.19 billion beat the forecast of $1.16 billion. Revenue also improved from Q1 2023 when it was $1.08 billion.
On May 15, Ventas announced a quarterly dividend of $0.45 per common share, in line with its previous quarterly dividend, payable July 18 to shareholders of record on July 1.
On May 16, Scotiabank analyst Nicholas Yulico maintained Ventas with a Sector Perform rating, raising the price target from $47 to $51. Ventas has had a significant run-up over the past month from $41.45 to $48.71 and could be overextended. But analyst Yulico still believes it has further to go within the next year.
VICI Properties
VICI Properties Inc (NYSE:VICI) is a New York-based diversified experiential REIT specializing in owning and operating gaming, hospitality and entertainment properties. Its triple-net portfolio includes well-known Las Vegas hotels such as Caesars Palace, MGM Grand and the Venetian Resort.
VICI Properties was formed as a REIT in 2017 and was a spinoff from Caesars Entertainment Operating Company as part of a Chapter 11 reorganization. The IPO was held on Feb. 1, 2018. Vici Properties’ portfolio of 93 properties presently includes 54 gaming and 39 nongaming facilities, with 60,300 hotel rooms and over 500 restaurants, bars, nightclubs and sportsbooks.
On May 1, VICI Properties reported first quarter earnings of $0.56 per share, which met the consensus estimate. Revenue of $951.50 million beat the consensus estimate of $936.67 million and topped Q1 2023 revenue of $877.65 million.
On May 16, Scotiabank analyst Nicholas Yulico maintained VICI Properties with a Sector Outperform rating and raised the price target from $32 to $34. This represents a potential 12.28% increase from its recent closing price of $30.28. This was the second analyst price target hike in the past week. Mizuho analyst Haendel St. Juste maintained a Buy rating on May 10 and increased the price target from $31 to $32.
Simon Property Group
Simon Property Group Inc. (NYSE:SPG) Simon Property Group is an Indianapolis-based retail REIT that owns and leases over 250 properties, consisting of shopping malls, restaurants, outlet centers and entertainment venues. It has locations in the top 25 population markets across the U.S. Simon Property Group was founded in 1960 and launched its IPO in 1993. Its occupancy rate for its U.S. malls and premium outlets at the end of Q1 2024 was 95.5%, down from 95.8% in Q4 2023, but up from 94.4% in Q1 2023.
On May 6, Simon Property Group reported excellent Q1 2024 operating results. FFO of $3.56 per share trounced the consensus estimate of $2.82 and was almost 30% above FFO of $2.74 per share in the year-ago quarter. Revenue of $1.44 billion was ahead of estimates of $1.29 billion by 11.83% and was a 6.78% increase over Q1 2023 revenue of $1.35 billion.
On May 16, Scotiabank analyst Nicholas Yulico maintained Simon Property with a Sector Perform rating and raised the price target from $142 to $152. Simon recently closed at $148.66 down from a high of $157.82 in late March.
2 High-Yield Alternatives
REITs are an excellent option for adding real estate to a portfolio and generating a realiable stream of passive income, but smart investors should also consider alternative investments that offer diversification outside of the stock market and an attractive yield. Two such options are the Ascent Income Fund and Basecamp Alpine Notes from EquityMultiple.
The Ascent Income Fund targets stable income from senior commercial real estate debt positions, offering a compelling yield backed by real assets. With a historical distribution yield of 12.1%, payment priority, and flexible liquidity options, the Ascent Income Fund is a cornerstone investment vehicle for income-focused investors. For a limited time, first-time investors with EquityMultiple can invest in the Ascent Income Fund with a reduced minimum of just $5,000.
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This article 4 REITs With Recent Price Target Increases originally appeared on Benzinga.com
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