W.P. Carey Tops Earnings Estimates


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W.P. Carey ( WPC ) easily topped expectations with its second-quarter results this week.

The real estate investment trust specializing in commercial space reported Tuesday adjusted funds from operations (FFO) of $1.21 a share, an increase of 15%.

Revenue excluding reimbursable costs climbed 26% to $205.2 million as the company concluded its first full quarter of operations with a recent acquisition.

Carey also raised its full-year FFO guidance to $4.62 to $4.82 a share. The earlier forecast was for $4.40 to $4.65.

The company's earnings history has been more uneven than other REITs.

Carey focuses on sale-leaseback properties, a strategy in which it buys its clients' buildings and leases them back to those companies.

It gets most of its revenue from rents, but it also works as an adviser to several nontraded REITs, earning 13% of revenue from that business.

It owns about 700 properties in 16 countries, totaling more than 83 million square feet of real estate. The company says 98.5% of that space is occupied.

The portfolio is well diversified, with 20% in retail space, 10% in the electronics industry and the rest spread among auto dealers, health, publishing, construction and other industries.

Carey pays a quarterly dividend of 90 cents a share for an annualized yield of 5.4%. Since 1998, the dividend has been raised almost every quarter, according to the company's website. That gives the company an outstanding dividend growth rate.

Shares of W.P. Carey have been in a long, saucerlike consolidation since May 2013. There's no clear entry on its chart, but the stock is near its 52-week high of 69.09.

The Accumulation/Distribution Rating and the up-down volume ratio are at bullish levels, which bode well for the stock's outlook.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Personal Finance , Investing Ideas

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