VICI Properties Achieves Credit Rating Upgrade, Boosting Investment Opportunities
Credit Rating Improvement Paves the Way for Growth
VICI Properties Inc. has received a significant credit rating upgrade from Moody’s Investors Service, moving from ‘Ba1’ to ‘Baa3’ while maintaining a stable outlook. This upgrade is crucial as it enables VICI to access capital markets at more favorable rates, opening doors for profitable investments.
The rating agency credited VICI’s well-diversified portfolio, steady cash flow, strong liquidity, and strategic financial maneuvers for this positive adjustment.
“We have used each transformational transaction along the way to improve our balance sheet and to best position ourselves for credit rating improvements,” commented David Kieske, CFO of VICI Properties.
Despite a 2.2% drop in shares over the past month, VICI is still outperforming the broader industry, which has seen a decline of 3.0%.
Image Source: Zacks Investment Research
Diverse Portfolio Boosts Potential
VICI Properties boasts a geographically diverse portfolio that includes numerous gaming, hospitality, and entertainment assets across the U.S. and Canada. Among its noteworthy holdings are three prominent venues on the Las Vegas Strip: Caesars Palace, MGM Grand, and the Venetian Resort.
Relationships with premier experiential operators enhance VICI’s revenue stability through long-term triple-net leases.
Recent Financial Performance Shows Strength
In October, VICI reported its quarterly funds from operations (FFO) at 57 cents per share, surpassing the Zacks Consensus Estimate of 56 cents and an increase from last year’s 54 cents. This performance was driven by robust revenues from higher same-store rentals, resulting in total revenues climbing 6.7% year-over-year to $964.7 million.
As of September 30, 2024, VICI holds approximately $3.3 billion in liquidity, broken down into $355.7 million in cash, $630.2 million from expected forward sale equity, and nearly $2.3 billion in available revolving credit. This strong liquidity positions VICI well to manage unforeseen challenges and seize growth opportunities.
Stocks to Keep an Eye On
Investors may also want to consider other strong performers within the REIT sector, such as Cousins Properties (CUZ) and Welltower (WELL), both currently rated Zacks Rank #2 (Buy). The Zacks Consensus Estimate for Cousins Properties’ 2024 FFO per share is projected at $2.68, reflecting a 2.3% increase from last year. Meanwhile, Welltower’s estimate stands at $4.26, indicating a year-over-year growth of 17.0%.
Note: Funds from operations (FFO) is a key indicator in assessing the performance of REITs.
Explore Top Stock Picks
Experts have identified seven elite stocks from the current Zacks Rank #1 Strong Buys list that are projected to see early price increases. Historically, this select group has more than doubled market performance, achieving over a 23.7% average annual gain since 1988.
Cousins Properties Incorporated (CUZ): Free Stock Analysis Report
Welltower Inc. (WELL): Free Stock Analysis Report
VICI Properties Inc. (VICI): Free Stock Analysis Report
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The views and opinions expressed herein are those of the author and do not necessarily reflect the opinions of Nasdaq, Inc.
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