For Mid-America Apartment Communities Inc (NYSE: MAA), a multifamily REIT with roughly 100,000 apartment units and a small development platform, the multiple concerns moving forward outweigh the positives, according to Stifel.
Stifel's John Guinee downgraded Mid-America Apartment Communities from Buy to Hold with an unchanged $100 price target.
The analyst's concerns outweigh the positives:
- Few barriers for rival REITs to compete in Mid-America Apartment Communities' existing or future markets;
- Increasing development and/or replacement costs;
- Management's revised assumptions for its core portfolio operations to the downside are unlikely to reverse in the near term; and
- The company's development platform isn't very active.
Investors looking for exposure to the REIT sector may want to consider instead multifamily platforms that boast strong development efforts or trading at a more attractive total enterprise value/unit versus Mid-America Apartment Communities' TEV/unit of $164,000.
Mid-America Apartment Communities' reported second-quarter results Wednesday, which unlike many of its peers didn't include an increase to the underlying drivers to funds from operations (FOO) growth, the analyst wrote.
Shares of Mid-America Apartment Communities were trading around $101.67 Friday.
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Latest Ratings for MAA
|Aug 2018||Stifel Nicolaus||Downgrades||Buy||Hold|
|May 2018||BTIG Research||Downgrades||Buy||Neutral|
|Feb 2018||Cantor Fitzgerald||Maintains||Overweight|
View More Analyst Ratings for MAA
View the Latest Analyst Ratings
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