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SITE Centers (SITC) Rewards Investors With 9% Dividend Hike

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SITE Centers Corp. SITC recently announced a 9% increase in its quarterly common stock dividend. The company will now pay 12 cents per share for second-quarter 2021 compared with the 11 cents paid in the prior quarter.

The increased dividend will be paid on Jul 2, to shareholders on record as of Jun 10, 2021. The latest dividend rate marks an annualized amount of 48 cents per share versus the prior rate of 44 cents per share. Based on the company’s share price of $14.41 on May 11, it results in a dividend yield of 3.3%.

Solid dividend payouts remain the biggest attraction for REIT investors and SITE Centers remained committed to that. However, amid the pandemic, the company has prioritized maintaining maximum flexibility for its value-enhancing redevelopment endeavors over dividend payments.

Hence, it suspended dividends for the second and the third quarters of 2020. Later, in November 2020, the company announced a dividend of 5 cents per share for fourth-quarter 2020. In February 2021, it further increased distributions to 11 cents per share for first-quarter 2021 and has again raised it 9% to 12 cents per share. However, the figure is still way down from the dividend of 20 cents per share paid out in the pre-pandemic period in first-quarter 2020.

Nevertheless, last month, SITE Centers reported first-quarter 2021 operating funds from operations per share of 28 cents, which surpassed the Zacks Consensus Estimate of 23 cents. The company generated revenues of $119.99 million in the first quarter, outpacing the Zacks Consensus Estimate of $109.82 million.

Results reflected improvement in rent collection and deferral repayment trends. Notably, the high composition of essential businesses and national tenants has likely supported rent receipts. As of Apr 16, all of the company’s properties were open, while 99% of tenants (at the company’s share and based on average base rents) were open for business. As of the same date, SITE Centers collected about 96% of rents for the first quarter. Rent collection for the previous three quarters also improved.

The company’s open-air shopping centers located in sub-urban and thriving regions are well poised to attract customers. Along with improvement in rent collections, its decent balance sheet and aggressive capital-recycling program are likely to support steady dividend payments in the upcoming period.

Shares of this Zacks Rank #3 (Hold) company have appreciated 17% over the past three months compared with the industry's rally of 9%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Retail REITs in Q1

Kimco Realty Corp.’s KIM first-quarter NAREIT FFO came in at 33 cents per share, surpassing the Zacks Consensus Estimate of 30 cents. Results highlighted better-than-anticipated top-line numbers. Moreover, the retail REIT raised the outlook for 2021. With a well-located and largely grocery-anchored portfolio that offers essential goods and services, the retail REIT witnessed decent leasing activity during the first quarter. Rent-collection figures were also healthy. The company collected 94% of total pro-rata base rents billed during the first quarter.

Realty Income Corporation’s O first-quarter adjusted FFO per share of 86 cents beat the Zacks Consensus Estimate of 85 cents. The encouraging performance reflected improved revenues in the quarter. The retail REIT also apprised of its rental receipts through Mar 31, 2021, and noted that it has collected 94.1% of contractual rent due for the first quarter across the total portfolio.

Regency Centers Corporation’s REG first-quarter 2021 NAREIT FFO per share of 90 cents handily topped the Zacks Consensus Estimate of 75 cents. Results reflected higher-than-anticipated revenue numbers. The retail REIT has also issued an upbeat outlook. Total revenues of $274.7 million outpaced the Zacks Consensus Estimate of $255.5 million.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.

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Kimco Realty Corporation (KIM) : Free Stock Analysis Report

Regency Centers Corporation (REG) : Free Stock Analysis Report

Realty Income Corporation (O) : Free Stock Analysis Report

SITE CENTERS CORP. (SITC) : Free Stock Analysis Report

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