Shares of Kimco Realty Corp. (KIM) touched a 52-week high of $22.55 on Tuesday, Apr 2, 2013, as it gained momentum from better-than-expected fourth-quarter 2012 results. The closing price of this retail real estate investment trust (:REIT) on Apr 3, 2013 was $22.54, representing a solid year-to-date return of 16.5%. The average trading volume over the last 3 months was 2.45 million shares.
Despite hitting its 52-week high, this Zacks Rank #3 (Hold) stock has plenty of upside left given its strong fundamentals and strategic portfolio repositioning efforts.
Kimco reported improved fourth-quarter 2012 results with core FFO, and revenues beating the Zacks Consensus Estimate. The company has a premium portfolio of retail properties in high-income, high-growth areas, and has achieved significant diversification through geographic distribution of its properties and a large tenant base. This diversification helps limit its operating and leasing risks. It is currently focusing on its core business activities to tide over the volatility in the market. In addition, it has a strong balance sheet with easy access to capital to allow continued growth.
Moreover, last month, the company closed the purchase of Wilton River Park located in Conn.. The deal is a strategic fit and brings on board well known national retailers such as Gap Inc. (GPS), Starbucks Corporation (SBUX) and True Value Hardware, fashion boutiques Snappy Gator and Chou Chou, and the 4-screen Bow Tie Cinemas.
On Feb 5, Kimco reported adjusted FFO (funds from operations) per share of 33 cents, beating the Zacks Consensus Estimate by 2 cents and the year-ago quarter figure by 3 cents. The results were aided by better-than expected growth in revenues. For full year 2012, the company’s adjusted FFO per share came in at $1.26, a cent ahead of the Zacks Consensus Estimate of $1.25 and 6 cents above the prior-year figure of $1.20 per share.
Notably, Kimco has now delivered positive earnings surprises in 2 quarters with an average beat of 4.89%.
Over the last 7 days, the Zacks Consensus Estimate for full-year 2013 and 2014 have remained unchanged at $1.32 and $1.37 per share, respectively.
On Apr 3, another REIT stock - Liberty Property Trust (LRY) - achieved its 52-week high.
Note: Funds from operations, a widely accepted and reported measure of REITs performance, are derived by adding depreciation, amortization and other non-cash expenses to net income.
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