Regency Centers Corporation
) - the retail real estate investment trust (REIT) - is slated to
report its first-quarter 2014 results on May 7, after the market
close. Last quarter, it posted a 3.13% positive surprise.
The company has posted an average positive earnings surprise of
3.56% over the past four quarters, beating the estimate in the
last 4 quarters. Let's see how things are shaping up for this
Why a Likely Positive Surprise?
Our proven model reveals that Regency is likely to beat earnings
because it has the right combination of two key ingredients.
Positive Zacks ESP: The company's
, which represents the difference between the Most Accurate
estimate (66 cents) and the Zacks Consensus Estimate (65 cents),
stands at +1.54%. This is meaningful and a leading indicator of a
likely positive earnings surprise for the shares.
Zacks Rank: Regency carries a Zacks Rank #3 (Hold). Note that
stocks with Zacks Ranks #1, 2 or 3 have a significantly higher
chance of beating earnings.
We caution against stocks with Zacks Ranks #4 and 5 (Sell-rated
stocks) going into the earnings announcement, especially when the
company is seeing negative estimate revisions momentum.
What is Driving the Better-than-Expected
Regency primarily focuses on building a premium portfolio of
grocery-anchored shopping centers. Such centers are usually
necessity driven and drive in dependable traffic. Moreover,
growing consumer confidence is essentially increasing the demand
for retail goods and in turn, the demand for real estates
supporting this sector. Also, amid a low supply of new
properties, we expect this to aid growth in rents.
The recent analysis by the commercial real estate services firm
CBRE Group, Inc.
) is encouraging. This study reveals that the retail availability
rate dropped 10 bps to 11.9% in the first-quarter 2014,
reflecting its first dip below 12% since 2009. The CBRE forecast
of a further decline in availability rate for neighborhood and
community shopping centers to 10.6% in 2014 raises our hope
Other Stocks to Consider
Regency is not the only firm looking up this earnings season.
Other stocks in the REIT sector that have both a positive
Earnings ESP and a favorable Zacks Rank are:
Strategic Hotels & Resorts, Inc.
), with an Earnings ESP of +83.3% and a Zacks Rank #2. The
company will release its first-quarter 2014 results on May 7,
after the closing bell.
Kimco Realty Corp.
), with an Earnings ESP of +2.94% and a Zacks Rank #3. This
company will also report its first-quarter 2014 results on May 7,
after the closing bell.
STRATEGIC HOTEL (BEE): Free Stock Analysis
CBRE GROUP INC (CBG): Free Stock Analysis
KIMCO REALTY CO (KIM): Free Stock Analysis
REGENCY CTRS CP (REG): Free Stock Analysis
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