Credit: Shutterstock photoLamar Advertising Co.LAMR reported third-quarter 2015 adjusted Funds from Operations ("FFO") of $1.27 per share, surpassing the Zacks Consensus Estimate of $1.16 and ahead of the year-ago quarter tally of $1.14.
Net revenue for the quarter increased 4.7% year over year to $350.7 million, exceeding the Zacks Consensus Estimate of $350 million.
Quarter in Detail
Operating income rose to $111.6 million from $86 million recorded in the comparable prior-year period. The company's pro forma direct and G&A operating expense was held to 1.4%, reflecting prudent cost management.
Adjusted earnings before interest, taxes, depreciation and amortization ("EBITDA") climbed 3.7% year over year to $159 million. Moreover, free cash flow increased 7.5% year over year to $108.7 million.
At the quarter-end, Lamar had total liquidity of $275.4 million, of which $246.3 million was available under its revolving senior credit facility and $29.1 million in cash and cash equivalents.
Our Take
Lamar, backed by an improving operational performance, continues to trend the growth track. The company's transformation to a real estate investment trust ("REIT"), its diversified tenant base, impressive national footprint and a healthy balance sheet bode well for the long term.
Lamar currently has a Zacks Rank #3 (Hold). Investors interested in the REIT industry may consider stocks like Rexford Industrial Realty, Inc. REXR , Gramercy Property Trust Inc. GPT and Extra Space Storage Inc. EXR . All these stocks sport 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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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
