U.S. markets closed
  • S&P 500

    4,455.48
    +6.50 (+0.15%)
     
  • Dow 30

    34,798.00
    +33.18 (+0.10%)
     
  • Nasdaq

    15,047.70
    -4.54 (-0.03%)
     
  • Russell 2000

    2,248.07
    -10.97 (-0.49%)
     
  • Crude Oil

    73.95
    +0.65 (+0.89%)
     
  • Gold

    1,750.60
    +0.80 (+0.05%)
     
  • Silver

    22.42
    -0.26 (-1.16%)
     
  • EUR/USD

    1.1718
    -0.0029 (-0.25%)
     
  • 10-Yr Bond

    1.4600
    +0.0500 (+3.55%)
     
  • GBP/USD

    1.3681
    -0.0040 (-0.29%)
     
  • USD/JPY

    110.6850
    +0.3840 (+0.35%)
     
  • BTC-USD

    43,097.84
    +200.75 (+0.47%)
     
  • CMC Crypto 200

    1,067.20
    -35.86 (-3.25%)
     
  • FTSE 100

    7,051.48
    -26.87 (-0.38%)
     
  • Nikkei 225

    30,248.81
    +609.41 (+2.06%)
     

Lamar (LAMR) Q4 FFO & Revenues Top Estimates, Costs Decline

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·5 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

Lamar Advertising Company LAMR reported fourth-quarter 2020 adjusted funds from operations (FFO) per share of $1.71, outpacing the Zacks Consensus Estimate of $1.50. Moreover, the figure is up from the $1.64 reported in the year-ago period.

Results reflect better-than-expected revenue numbers for the quarter. Also, the company benefited from a fall in operating expenses.

Particularly, quarterly net revenues came in at $428.5 million, surpassing the consensus mark of $416.4 million. However, on a year-over-year basis, net revenues for the quarter declined 7.4%.

Reflecting broader market sentiments, shares of the company edged down 0.3% during Friday’s regular trading session.

According to the company’s chief executive Sean Reilly, “We concluded 2020 with a strong fourth quarter, aided by a recovery in national advertising and a surge in political spending, as well as further good work on the expense side."

Moreover, he pointed that, "We have begun to invest again in our platform, and, with the strongest balance sheet in the industry, we are positioned well to benefit as the advertising market recovers further in 2021.”

For full-year 2020, the company reported adjusted FFO per share of $5.10, down from the prior year’s $5.80. Net revenues declined 10.5% to $1.57 billion from the $1.75 billion reported last year.

Quarter in Detail

Acquisition-adjusted net revenues for the fourth quarter decreased 6.8% year on year to $428.5 million. Also, acquisition-adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) fell 2.8% to $207.9 million.

Operating income marginally declined to $141.2 million from the year-earlier period’s $141.4 million, while adjusted EBITDA went down 3.6% to $207.9 million. However, free cash flow of $160.1 million increased 18.3% year over year during the December-end quarter.

Operating expenses slid 10.6% from the prior-year quarter to $287.3 million.

Balance Sheet

At the end of 2020, Lamar Advertising had total liquidity of $910.1 million. This comprised $736 million available for borrowing under its revolving senior credit facility, $52.5 million available under the Accounts Receivable Securitization Program, and $121.6 million in cash and cash equivalents.

Outlook

Lamar Advertising projects 2021 adjusted FFO per share at $5.20-$5.50. The Zacks Consensus Estimate for the same is currently pinned at $6.55.

Dividend Update

On Feb 25, Lamar announced a quarterly dividend of 75 cents per share, which reflects a 50% increase from the 50 cents paid in the prior quarter. The dividend will be paid on Mar 31, 2021, to stockholders of record of Lamar’s Class A and Class B common stock as of Mar 22, 2021.

Lamar predicts total quarterly distributions to stockholders in 2021 to aggregate $3.00 per common share, inclusive of the dividend payable on Mar 31, 2021.

Lamar currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Lamar Advertising Company Price, Consensus and EPS Surprise

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

Lamar Advertising Company price-consensus-eps-surprise-chart | Lamar Advertising Company Quote

Performance of Other REITs

OUTFRONT Media Inc. OUT delivered fourth-quarter 2020 adjusted FFO per share of 35 cents, outpacing the Zacks Consensus Estimate of 27 cents. In the prior-year quarter, the company had reported adjusted FFO per share of 73 cents. Results underlined a decline in operating expenses, and selling, general and administrative expenses. However, a decline in revenues on dwindling demand for its services is a concern.

Extra Space Storage, Inc. EXR reported core FFO per share of $1.48, beating the Zacks Consensus Estimate of $1.35 in the October-December quarter. The figure came in 16.5% higher than the prior-year quarter’s $1.27. Results reflected strong average occupancy and higher average rates to existing customers for the quarter, partially offset by lower late fees. The company also witnessed reductions in most expense categories, partly muted by rise in property taxes.

PS Business Parks, Inc. PSB posted core FFO per share of $1.66, topping the Zacks Consensus Estimate of $1.64 for the December-end quarter. In addition, the reported figure increased from the $1.65 reported in the year-ago period. Results highlighted increased cash rental income from the occupied portion of its same-park portfolio, though lower weighted average occupancy in the quarter played spoilsport.

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.

+1,500% Growth: One of 2021’s Most Exciting Investment Opportunities

In addition to the stocks you read about above, would you like to see Zacks’ top picks to capitalize on the Internet of Things (IoT)? It is one of the fastest-growing technologies in history, with an estimated 77 billion devices to be connected by 2025. That works out to 127 new devices per second.

Zacks has released a special report to help you capitalize on the Internet of Things’s exponential growth. It reveals 4 under-the-radar stocks that could be some of the most profitable holdings in your portfolio in 2021 and beyond.

Click here to download this report FREE >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Lamar Advertising Company (LAMR) : Free Stock Analysis Report

PS Business Parks, Inc. (PSB) : Free Stock Analysis Report

Extra Space Storage Inc (EXR) : Free Stock Analysis Report

OUTFRONT Media Inc. (OUT) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research