AvalonBay Communities AVB reported third-quarter 2024 core funds from operation (FFO) per share of $2.74, which beat the Zacks Consensus Estimate of $2.71. Moreover, the figure climbed 3% from the prior-year quarter.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
The quarterly results reflected a year-over-year increase in same-store residential revenues. Same-store average monthly revenue per occupied home also rose. This residential REIT revised its 2024 core FFO per share outlook.
Total revenues in the quarter came in at $734.3 million, which outpaced the Zacks Consensus Estimate of $731.7 million. The figure increased 5.3% % on a year-over-year basis.
AvalonBay's Quarter in Detail
In the reported quarter, same-store residential revenues climbed 3.1% year over year to $671.5 million. Same-store residential operating expenses rose 5.4% to $214.8 million. Same-store residential NOI climbed 2.0% to $456.7 million from the prior-year period.
Same-store average revenue per occupied home rose to $3033 in the third quarter, up from $2,939 in the third quarter of 2023. The same-store economic occupancy was 95.6%, decreasing 10 basis points (bps) year over year. We estimated the metric to be 95.9%.
As of Sept. 30, 2024, AvalonBay had 19 wholly-owned development communities under construction (expected to contain 6,855 apartment homes and 56,000 square feet of commercial space). The estimated total capital cost of these development communities at completion is $2.68 billion.
AvalonBay's Portfolio Activity
During the third quarter, AvalonBay acquired three wholly-owned communities, Avalon Perimeter Park in Morrisville, NC, with 262 apartment homes for $66.5 million, Avalon Cherry Hills in Englewood, CO, with 306 apartment homes for $95 million; and AVA Balboa Park in San Diego, CA, with 100 apartment homes and 1,700 square feet of commercial space for $51 million.
AvalonBay's Balance Sheet
AVB had $552.4 million in unrestricted cash and cash equivalents as of Sept. 30, 2024. As of the same date, the company did not have any borrowings outstanding under its $2.25 billion unsecured revolving credit facility or $500 million unsecured commercial paper note program.
The annualized net debt-to-core EBITDAre for the third quarter was 4.2 times. The unencumbered NOI for the nine months ended Sept. 30, 2024, was 95%.
AVB's 2024 Outlook Revised
For the fourth quarter of 2024, AvalonBay expects core FFO per share in the range of $2.78-$2.88. The Zacks Consensus Estimate is currently pegged at $2.83, which lies within the guided range.
For the full year, AVB now expects core FFO per share between $10.99 and $11.09, compared with the previously guided range of $10.92-$11.12. This indicates a 3.9% increase at the midpoint compared with the 3.7% expected earlier. The Zacks Consensus Estimate presently stands at $11.02, within the projected range.
For the full year, management expects same-store residential revenue growth to be 3.5% at the midpoint, unchanged from prior guidance, while operating expenses are projected to increase by 4.5% at the midpoint, down from the prior outlook of 4.8%. Same-store residential NOI growth is estimated at 3.0% at the midpoint, higher than the 2.9% projected before.
AvalonBay currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
AvalonBay Communities, Inc. Price, Consensus and EPS Surprise
AvalonBay Communities, Inc. price-consensus-eps-surprise-chart | AvalonBay Communities, Inc. Quote
Performance of Other Residential REITs
UDR Inc. UDR reported third-quarter 2024 funds from operations as adjusted (FFOA) per share of 62 cents, in line with the Zacks Consensus Estimate. On a year-over-year basis, FFOA per share declined 1.6%.
Results reflected an increase in revenues from same-store communities, prior-year acquisitions and completed developments. UDR raised its full-year 2024 guidance.
Essex Property Trust Inc. ESS reported third-quarter 2024 core FFO per share of $3.91, which beat the Zacks Consensus Estimate of $3.88. The figure also improved 3.4% from the year-ago quarter.
Results reflected favorable growth in same-property revenues and NOI. Essex Property Trust also raised its full-year 2024 guidance.
Equity Residential EQR reported third-quarter 2024 normalized FFO per share of 98 cents, in line with the Zacks Consensus Estimate. The figure also improved 2.1% from the year-ago quarter.
Results reflected decent same-store performances, backed by healthy demand amid modest supply. EQR revised its 2024 guidance.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.
Only $1 to See All Zacks' Buys and Sells
We're not kidding.
Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent.
Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators,and more, that closed 228 positions with double- and triple-digit gains in 2023 alone.
See Stocks Now >>AvalonBay Communities, Inc. (AVB) : Free Stock Analysis Report
Equity Residential (EQR) : Free Stock Analysis Report
United Dominion Realty Trust, Inc. (UDR) : Free Stock Analysis Report
Essex Property Trust, Inc. (ESS) : Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
