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Cousins Properties (CUZ) Q3 FFO & Revenues Beat Estimates

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Shares of Cousins Properties Incorporated CUZ appreciated 4.3% after the company reported better-than-expected third-quarter results. The third-quarter 2020 funds from operations (FFO) per share of 69 cents surpassed the Zacks Consensus Estimate of 67 cents. Moreover, rental property revenues for the quarter came in at $179 million, outpacing the Zacks Consensus Estimate of $176.4 million.

Quarterly results reflect growth in net rent per square foot and weighted average occupancy. The company informed that its rent collection for the third quarter was 98.2%, including 98.7% from office tenants. In September, the company collected 98.6% of its rents, including 99.1% from office tenants.

However, on a year-over-year basis, rental property revenues for the quarter edged down 1%. Moreover, the reported FFO figure also came in lower than the prior-year quarter’s 72 cents.

Management also updated the current-year outlook in light of the coronavirus pandemic.

Quarter in Detail

Cousins Properties executed leases for 254,942 square feet of office space during the September-end quarter. Same-property net operating income (NOI), on a cash basis, decreased 3% from the year-ago quarter. As of Sep 30, 2020, 93.6% of its same-property portfolio was leased, contracting 80 basis points (bps) from the end of the second quarter.

Temporary rent deferral agreements and a decline in parking revenues affected same-property performance during the third quarter.

Nonetheless, second-generation net rent per square foot (cash basis) climbed 8.9%. Weighted average occupancy for the company’s same-property portfolio of 91.9% for the quarter ended Sep 30, 2020, increased 40 bps from the prior quarter.

In the reported quarter, Cousins Properties acquired a piece of land in Austin, TX, spanning an area of 1.7 acres for $11 million through a joint venture in which the company has a 90% stake.

Cousins Properties exited the third quarter with cash and cash equivalents of $36.9 million compared with $15.6 million recorded as of Dec 31, 2019. The company has in excess of $1 billion of available liquidity.

2020 Outlook

The company provided updates regarding its current-year guidance.

Cousins Properties projects general and administrative expenses (net of capitalized salaries) of $25.5-27.5 million, down 22% from the $27-$29 million guided earlier.

Cousins Properties Incorporated Price, Consensus and EPS Surprise

Cousins Properties Incorporated Price, Consensus and EPS Surprise
Cousins Properties Incorporated Price, Consensus and EPS Surprise

Cousins Properties Incorporated price-consensus-eps-surprise-chart | Cousins Properties Incorporated Quote

Cousins Properties currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other REITS

Boston Properties Inc.’s BXP third-quarter 2020 FFO per share of $1.57 missed the Zacks Consensus Estimate of $1.64. The reported figure also decreased 4.3% from the year-ago quarter’s $1.64.

SITE Centers Corp.’s SITC third-quarter operating FFO per share of 23 cents came in line with the Zacks Consensus Estimate. The reported figure, however, declined 23.3% year over year.

Highwoods Properties, Inc. HIW third-quarter 2020 FFO per share of 86 cents missed the Zacks Consensus Estimate of 88 cents. The figure included 5 cents from debt extinguishment charges and non-cash straight-line credit losses. Nonetheless, the reported figure improved 3.6% from the 83 cents reported in the year-ago period.

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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Highwoods Properties, Inc. (HIW) : Free Stock Analysis Report
 
Boston Properties, Inc. (BXP) : Free Stock Analysis Report
 
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SITE CENTERS CORP. (SITC) : Free Stock Analysis Report
 
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