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Equity Residential Collects 93% of April Rental Receipts

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Equity Residential EQR announced that it has collected about 93% of its April cash rents through Apr 7, and is having talks with the remainder of the residents on payment options.

The coronavirus pandemic has left no sector untouched and the residential REIT industry is no exception. Rent collection during these trying times is difficult. The adverse impact of the pandemic on the economy will likely affect demand in the upcoming days. However, currently, the job-market impact and the financial stress have become key concerns as these hurt the rent-paying capability of tenants.

As a response to the pandemic, Equity Residential has taken a few measures to support its residents. The company announced that it will be halting evictions for 90 days for those residents who have been affected by the pandemic financially. This comes as a major relief for its tenants.

The company is also renewing the lease of its residents without any increase and providing flexible renewal options for the next 90 days. Also, for those who are in dire straits and unable to pay their rents, the company has decided to waive their late fees and support them by creating suitable payment plans.

The pandemic has left the company unable to quantify the impact on its financial performance. As such, it plans to provide an update on the same during its first-quarter 2020 earnings conference call.

Nevertheless, Equity Residential noted that its same-store portfolio remains well occupied at 96.5% as of Mar 24, 2020. The company is also seeing indications of increased retention. However, due to the several restrictions introduced by the government, the company is witnessing reduced foot traffic and applications.

In addition, the company remains committed to paying dividends to its investors. In March, Equity Residential announced an increase in its first-quarter 2020 dividend. It will now pay 60.25 cents per share, which reflects a hike of 6.2% from the prior dividend of 56.75 cents. The dividend will be paid on Apr 13 to shareholders of record on Mar 23, 2020.

Shares of this Zacks Rank #3 (Hold) company have declined 14.5% over the past year compared with the industry's fall of 13.9%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Stocks to Consider

Plymouth Industrial REIT’s PLYM Zacks Consensus Estimate for 2020 FFO per share moved up about 2% to $2.08 over the past two months. The stock currently has a Zacks Rank of 1.

NexPoint Residential Trust, Inc.’s NXRT FFO per share estimate for the ongoing year moved 1.19% north to $2.56 over the past week. The stock currently carries a Zacks Rank #2 (Buy).

SBA Communications Corporation’s SBAC FFO per share estimate for the current year moved 1.41% north to $9.37 over the past two months. The stock currently carries a Zacks Rank of 2.

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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Equity Residential (EQR) : Free Stock Analysis Report
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