Lamar 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.
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.