BXP, Inc. Shines Among Real Estate Investment Trusts with Strong Growth
Boston’s Premier Workplace Provider Achieves Impressive Gains
Boston-based BXP, Inc. (BXP), the largest publicly traded developer, owner, and manager of premier workplaces, has a market cap of $11.7 billion. Operating as a real estate investment trust (REIT), BXP owns, develops, and manages 186 office properties totaling 53.5 million square feet through joint ventures.
Over the past year, shares of this leading office REIT have significantly outperformed the broader market. BXP surged 49.4%, while the S&P 500 Index ($SPX) increased nearly 31%. However, BXP’s stock saw a 15% rise year-to-date in 2024, compared to the S&P 500’s higher growth of 25.2% during the same period.
When examining competitor performance, BXP has outshined the VanEck Office and Commercial REIT ETF (DESK). The ETF reported gains of approximately 41.8% over the past year, but its year-to-date increase of 17.2% has surpassed BXP’s stock returns for the same period.
On October 29, BXP reported its Q3 earnings, resulting in a 1.4% drop in share price, which continued over subsequent trading sessions. The company posted funds from operations (FFO) of $286.9 million, or $1.81 per share, in line with analyst predictions. Net income stood at $83.6 million, or $0.53 per share, while lease revenue totaled $799.5 million—slightly below the expected $803.8 million. Full-year FFO is estimated to be between $7.09 and $7.11 per share.
Despite the minor setbacks, optimism in the market is supported by anticipated Federal Reserve rate cuts and a shift towards returning to office environments, benefiting firms like BXP. Analysts project a 2.5% decline in FFO for the current fiscal year, estimating $7.10 per diluted share. Historically, BXP has a strong earnings record, beating or matching consensus estimates in the last four quarters.
According to 22 analysts covering BXP stock, the consensus rating leans toward a “Moderate Buy,” with eight “Strong Buy” ratings, 13 “Holds,” and one “Strong Sell.” This consensus reflects a more positive outlook than two months prior, when only seven analysts gave a “Strong Buy” rating.
On November 18, Barclays PLC (BCS) analyst Brendan Lynch raised BXP’s price target to $89 from $88 while maintaining an “Equal-Weight” rating. This change follows updated models in the real estate investment trust and communications infrastructure sectors influenced by earnings reports.
BXP’s average price target now sits at $82.72, indicating a 2.6% premium over the current market prices. Notably, the highest price target of $105 suggests a potential upside of 30.2%.
On the date of publication, Kritika Sarmah 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 for informational purposes only. Please view the Barchart Disclosure Policy for more details.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
