Realty Income Corporation Prepares for Q4 Earnings Report Amid Market Challenges
Realty Income Corporation (O), valued at a substantial market cap of $47.8 billion, specializes in acquiring and managing freestanding commercial properties that collect rental income through long-term net lease agreements. Based in San Diego, California, the company is set to release its fiscal Q4 earnings results on Tuesday, Feb. 18.
Forecasted Earnings Show Steady Growth
As the results approach, analysts predict that the REIT will report a Funds From Operations (FFO) of $1.06 per share, marking an increase of nearly 5% from $1.01 per share during the same quarter last year. Notably, Realty Income has either met or exceeded Wall Street’s FFO forecasts in three of the last four quarters, with only one miss. In Q3, the company’s FFO of $1.05 per share aligned with analyst expectations.
Looking Ahead to 2024
For its fiscal 2024 outlook, analysts estimate an FFO of $4.19 per share, which represents a growth of approximately 4.8% compared to $4 per share in fiscal 2023.
Over the past year, shares of Realty Income have dropped by 4.5%. This underperformance contrasts sharply with the S&P 500 Index’s ($SPX) impressive rise of 26.5% and the Real Estate Select Sector SPDR Fund’s (XLRE) return of 6.5% in the same period.
Recent Earnings Report and Stock Sentiment
Realty Income’s Q3 earnings report, released on Nov. 4, showed a slight dip in shares the following day after the company’s revenue of $1.3 billion fell slightly short of consensus estimates. Despite this, revenue rose 28.1% from the prior year. Factors affecting performance included a minor year-over-year decline in portfolio occupancy and a $63 million non-cash charge linked to a convenience store client. The adjusted FFO of $1.05 per share, however, marked a 2.9% year-over-year improvement, aligning with market projections.
Analyst Ratings and Price Targets
Wall Street’s analysis remains moderately optimistic about Realty Income, with a general “Moderate Buy” rating. Out of 23 analysts, six advocate for a “Strong Buy,” one suggests a “Moderate Buy,” and 16 recommend holding the stock—slightly less bullish than three months earlier when seven rated it a “Strong Buy.” The average price target stands at $61.37, indicating a modest potential upside of 12.3% from current levels.
On the date of publication, Neharika Jain did not hold positions in any of the securities mentioned in this article. All information and data are solely for informational purposes. For further details, please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
