The shareholders of real estate investment trust (REIT) -
Boston Properties Inc.
) have a reason to rejoice as the company has declared a special
cash dividend of $2.25 per share, which will be paid on Jan 29,
2014 to stockholders of record as of Dec 31, 2013.
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Notably, the disposition of 45% stake in the company's Time
Square Tower property in Oct 2013 is the reason for this special
dividend. Boston Properties also declared a regular quarterly
cash dividend of 65 cents per share for third-quarter 2013. This
dividend is also payable on Jan 29, 2014 to shareholders of
record as of the close of business on Dec 31, 2013.
As a matter of fact, Boston Properties came up with encouraging
results in October. The company reported third-quarter 2013 FFO
(funds from operations) per share of $1.29, which was a penny
ahead of the Zacks Consensus Estimate. Also, it exceeded the
year-ago quarter figure of $1.15 by 12.2%. The results were aided
by higher revenues and improved core operations.
Boston Properties exited third-quarter 2013 with cash and cash
equivalents of about $1.64 billion compared with $1.04 billion as
of Dec 31, 2012. We believe that the company has sufficient
liquidity to comfortably cushion its payout.
Boston Properties is benefiting from improved core operations and
has been successful in maintaining a strong grip on high
barrier-to-entry geographic markets across the U.S. Also, the
company has a solid balance sheet position with adequate
liquidity to facilitate further portfolio enhancement activities.
We expect this to drive growth and prove accretive to its
earnings going forward.
Yet, the demand remains moderate for office space with elevated
unemployment levels and adequate space availability, thus
creating pressure on rent and occupancies.
Boston Properties currently holds a Zacks Rank #3 (Hold). Some
better-ranked stocks in the same sector include
Getty Realty Corp.
National Health Investors Inc.
Sabra Health Care REIT, Inc.
). All these stocks carry a Zacks Rank #1 (Strong Buy).
FFO, a widely used metric to gauge the performance of REITs,
is obtained after adding depreciation and amortization and other
non-cash expenses to net income.