Federal Realty Investment Trust Set to Release Q4 Earnings Amid Economic Headwinds
Federal Realty Investment Trust (FRT), based in North Bethesda, Maryland, is a self-administered real estate investment trust (REIT) valued at $8.6 billion. This company focuses on owning, managing, developing, and redeveloping high-quality community and neighborhood shopping centers. Investors are anticipating the announcement of its fourth-quarter earnings for fiscal 2024, scheduled for after market close on Thursday, February 13.
Leading up to the earnings release, analysts forecast that FRT will report a profit of $1.75 per share, a 6.7% increase from $1.64 per share a year ago. Historically, FRT has been mixed in its performance relative to consensus estimates, beating or matching expectations in two of the last four quarters while falling short in the other two.
Outlook for Fiscal Year 2024 and Beyond
For the full year, analysts predict that FRT will report Funds From Operations (FFO) of $6.79, reflecting a 3.7% rise from $6.55 in fiscal 2023. Looking ahead, FFO is projected to grow by 5.5% year over year to reach $7.16 in fiscal 2025.
Stock Performance Lags Behind Major Indices
FRT stock has struggled over the past year, gaining only 1.1% while the S&P 500 ($SPX) rose by 24.4%. Additionally, it also slightly lagged behind the Real Estate Select Sector SPDR Fund (XLRE), which increased by 1.6% during the same timeframe.
Challenges Impacting Profitability
The underperformance of FRT is linked to increased property-level expenses, lower term fees, and overarching economic uncertainties. The shift in consumer preferences, along with the surge of e-commerce and job market fluctuations, has also affected retail leasing activity and foot traffic, raising concerns about profitability and occupancy rates.
Recent Financial Results and Analyst Sentiment
On October 30, FRT shares rose over 1% following the release of its third-quarter results. The FFO reported was $1.71, slightly below Wall Street’s estimate of $1.72, while revenue achieved was $303.6 million, surpassing expectations of $301.2 million. The company anticipates a full-year FFO between $6.70 to $6.88.
Analysts maintain a bullish outlook on FRT, giving it an overall “Strong Buy” rating. Out of 16 analysts covering the stock, 11 recommend a “Strong Buy,” one suggests a “Moderate Buy,” and four advise a “Hold.” The average price target set by analysts is $124.67, indicating a possible upside of 19.9% from current levels.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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