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Lamar Advertising's (LAMR) Q1 AFFO & Revenues Beat Estimates

Zacks Equity Research

Lamar Advertising Company LAMR reported first-quarter 2019 adjusted funds from operations (AFFO) of 99 cents per share, surpassing the Zacks Consensus Estimate of $1. This also marks a 1% increase from the year-ago quarter’s reported tally of 98 cents per share.

Robust top-line growth supported the company’s performance in the quarter. Further, higher operating income and free cash flow indicate strength in operating performance.

Net revenues for the first quarter climbed 6.5% from the prior-year quarter reported tally to $384.5 million. Moreover, the revenue figure outpaced the Zacks Consensus Estimate of $383.9 million.

Quarter in Detail

Operating income increased to $90.8 million from $65.9 million recorded in the year-ago period. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) rose 5.2%, year over year, to $146.1 million. Additionally, free cash flow of $82.7 million in the March-end quarter was up 1.6% year over year.

At the end of first-quarter 2019, Lamar had total liquidity of $389.7 million, of which $356.9 million was available under its revolving senior credit facility, and $32.8 million in cash and cash equivalents.

Our Take

Lamar’s robust national presence, tenants from diverse industries and valuable permits augur well for growth. Further, the company remains focused to strengthen its position in strategic markets through accretive acquisitions. In fact, when the acquired assets are completely integrated in Lamar’s portfolio, it is anticipated to drive sales and FFO growth in 2019.

Lamar Advertising Company Price, Consensus and EPS Surprise

Lamar Advertising Company Price, Consensus and EPS Surprise | Lamar Advertising Company Quote

Lamar currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other REITs

Cousins Properties Incorporated CUZ reported FFO per share of 20 cents during the January-March quarter, in line with the Zacks Consensus Estimate. The figure came in higher than the prior-year quarter’s reported tally of 15 cents. 

Duke Realty Corporation’s DRE first-quarter 2019 core FFO per share of 33 cents surpassed the Zacks Consensus Estimate of 32 cents. Moreover, the figure came in higher than the year-ago quarter’s reported tally of 30 cents.

Ventas, Inc. VTR delivered first-quarter normalized FFO of 99 cents, beating the Zacks Consensus Estimate of 96 cents. The reported figure, however, came in lower than the prior year’s $1.05.

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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