Vornado Realty Trust
) is riding high on portfolio streamlining efforts to focus
exclusively on the office assets in the New York City and
Washington, DC regions, including Manhattan street retail
Last month, this real estate investment trust (REIT) raised its
ownership stake in One Park Avenue in New York to 55% by making an
additional investment of $22.7 million (Read:
Vornado Raises Stake in One Park Avenue in New
). Moreover, in April, Vornado disclosed the plan to spin off its
shopping center business into a new publicly traded REIT and has
filed the initial Form 10 registration statement with the SEC on
Jun 26 for the same, while the transaction is targeted to be
accomplished by the end of 2014 (Read:
Vornado to Spin Off Shopping Centers
In May, Vornado came up with first-quarter 2014 adjusted funds
from operations (FFO) per share of $1.20, which missed the Zacks
Consensus Estimate by a dime, but surpassed the year-ago quarter
figure by 7 cents aided by notable portfolio repositioning and
leasing activity. In addition, the continued strong
performance of the New York portfolio on the back of improving
market fundamentals was the positive.
However, the Washington DC market is stressed and leasing
activity remains slow. Also, increase in online purchases could
hurt the demand for Vornado's retail properties. Additionally, the
sluggish pace of office market recovery and stiff competition
To gain deeper insight into Vornado, you can refer to our
updated research report, which was issued on Jul 7, 2014.
Over the last 30 days, the Zacks Consensus Estimate for 2014 FFO
per share moved up by a nickel to $4.81. Also, for 2015, it
increased by 3 cents to $5.21. The stock currently has a Zacks Rank
Stocks That Warrant a Look
Investors interested in REITs may consider stocks like
Chatham Lodging Trust
Aviv REIT, Inc.
Terreno Realty Corp.
). All these stocks hold a Zacks Rank #1 (Strong Buy).
Note: 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.
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VORNADO RLTY TR (VNO): Free Stock Analysis
AVIV REIT INC (AVIV): Free Stock Analysis
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CHATHAM LODGING (CLDT): Free Stock Analysis
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