PS Business Parks (PSB) Q4 FFO Misses Estimate, Revenues Up
PS Business Parks, Inc. PSB reported fourth-quarter 2017 core funds from operations (FFO) of $1.52 per share, missing the Zacks Consensus Estimate by a penny. However, the figure came in 9.4% higher than $1.39 recorded in the prior-year quarter.
The rise on a year-over-year basis stemmed from higher net operating income (NOI), reduced general and administrative expenses and savings from lower preferred distributions.
Rental income came in around $101.8 million, marking 4.3% growth from the year-ago figure. Additionally, the figure outpaced the Zacks Consensus Estimate of $101.7 million.
For full-year 2017, the company reported core FFO of $6.13 per share, 12.7% higher than the year-ago figure of $5.44. Further, rental income amounted to $402.2 million, up 4% from a year ago.
Quarter in Detail
Same Park rental income was up 5% year over year, while Same Park operating expenses flared 6.9%. As a result, Same Park NOI climbed 4.2% year over year, mainly on the back of improving rental rates.
Annualized Same Park realized rent per-square-foot rose 4.8% year over year to $15.16. Same Park weighted average occupancy in the quarter was 95.1%, up 30 basis points (bps) year over year.
PS Business Parks exited fourth-quarter 2017 with cash and cash equivalents of $114.9 million, lower than the prior-year end tally of $128.6 million.
On Feb 19, the company announced a regular quarterly dividend of 85 cents per share, same as the previous payout. The dividend is payable on Mar 29, to shareholders of record as of Mar 14, 2018.
PS Business Parks’ leasing performance is adversely affected by the unfavorable leasing environment in certain markets. Further, stiff competition from other office and industrial asset owners in the market hampers its ability to attract and retain tenant at higher rents. Moreover, any hike in interest rates will hurt its financial performance and dent its ability to pay dividends.
Nonetheless, healthy fundamentals in the multi-tenant flex, office and industrial asset categories are anticipated to stoke growth in the long run.
PS Business Parks, Inc. Price, Consensus and EPS Surprise
PS Business Parks, Inc. Price, Consensus and EPS Surprise | PS Business Parks, Inc. Quote
PS Business Parks currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
We are now looking forward to the earnings releases of Lamar Advertising Company LAMR, EPR Properties EPR and Outfront Media, Inc. OUT, all of which are expected to report in the upcoming days.
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.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7% and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them 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
EPR Properties (EPR) : Free Stock Analysis Report
PS Business Parks, Inc. (PSB) : Free Stock Analysis Report
OUTFRONT Media Inc. (OUT) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research