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Cousins Properties (CUZ) Q4 FFO & Revenues Surpass Estimates

Zacks Equity Research

Cousins Properties Incorporated CUZ reported fourth-quarter 2018 funds from operations (FFO) per share of 17 cents, beating the Zacks Consensus Estimate by a whisker. Further, the figure comes in higher than the prior-year tally of 15 cents.

Cousin Properties’ Q4 revenue figure recorded year-over-year growth. This was supported by increment in same-property cash net operating income (NOI).

Rental property revenues for the quarter came in at $119.4 million, which compares favorably with $110 million witnessed in the year-ago quarter. Moreover, the figure outpaced the Zacks Consensus Estimate of $117.9 million.

For full-year 2018, the FFO per share came in at 63 cents, beating the Zacks Consensus Estimate of 62 cents. The figure improved 3.3% year over year. Revenues for full-year 2018 improved 3.5% year over year to $461.8 million. The revenue figure also beat the Zacks Consensus Estimate of $460.4 million.

Quarter in Detail

Cousins Properties executed leases for 454,629 square feet of office space in the Oct-Dec quarter. Same-property NOI, on a cash basis, inched up 1.2% from the year-ago quarter. Moreover, second-generation net rent per square foot (cash basis) increased 13.1%.

During the quarter, the company commenced operations at the final phase of Spring & 8th, NCR's headquarters located in Midtown Atlanta.

Total expenses came in at nearly $102.5 million, up 3.2% from the prior-year quarter.

Cousins Properties exited the fourth quarter with cash and cash equivalents of $2.5 million compared with $148.9 million recorded as of Dec 31, 2017.

2019 Outlook

Cousins Properties has provided its guidance for full-year 2019 FFO per share. The company expects FFO per share to be in the band of 61-65 cents. The Zacks Consensus Estimate for the current-year FFO per share is currently pinned at 64 cents.

Conclusion

The company’s properties located in premium sun-belt markets have enabled it to enjoy robust rent growth that boosted its top-line performance during the quarter. Further, year-over-year growth in fee income supported results.

However, amid rising interest-rate environment, the company’s interest expense has been flaring up. This, in turn, impacted the company’s bottom-line growth.

Cousins Properties Incorporated Price, Consensus and EPS Surprise

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

 

Currently, Cousins Properties has a Zacks Rank #3 (Hold). You can the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other REITs

Duke Realty Corporation’s DRE fourth-quarter 2018 core FFO per share of 35 cents came in line with the Zacks Consensus Estimate. Moreover, the figure came in a penny ahead of the prior-year figure of 30 cents.

Alexandria Real Estate Equities, Inc. ARE reported fourth-quarter 2018 adjusted FFO of $1.68 per share, missing the Zacks Consensus Estimate by a whisker.

Boston Properties Inc.’s BXP fourth-quarter 2018 FFO per share of $1.59 also missed the Zacks Consensus Estimate of $1.68. The figure, however, came in 7% higher than the prior-year tally.

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

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