Shares of Federal Realty Investment Trust (FRT) touched a 52-week high of $113.72 at the end of the trading session on Friday, Apr 12, 2013, as it gained momentum following the disclosure of noteworthy expansion moves in the recent months. The closing price of this real estate investment trust (REIT) represented a solid year-to-date return of 8.7%. The average trading volume over the last 3 months was 0.24 million shares.
Despite hitting its 52-week high, this Zacks Rank #2 (Buy) stock has plenty of upside left, given its strong fundamentals and strategic portfolio repositioning efforts.
Growth Drivers
Federal Realty reported better-than-expected fourth-quarter 2012 results with FFO (funds from operations) and revenues beating the Zacks Consensus Estimate. The results were aided by improved performance in the same-store portfolio and decent top-line growth. The company’s recent efforts to enhance its reach in the best locations in key markets in the U.S. are also encouraging.
This month, Federal Realty acquired a Darien, CT-based shopping center for $47.3 million. The acquired property, which was anchored by Walgreen Co. (WAG), Stop & Shop grocer and an Equinox health club, marks the company’s strategic expansion into the New York commuter suburbs. Earlier too, Federal Realty acquired a property, East Bay Bridge Shopping Center, located on the Emeryville and Oakland border for $53.7 million. We expect these activities to help increase Federal Realty’s share in top U.S. markets, characterized by strong demographics and high barriers to entry.
On Feb 12, Federal Realty reported fourth-quarter 2012 FFO per share of $1.11, exceeding the Zacks Consensus Estimate by a cent and the prior-year quarter figure by 14 cents. For full-year 2012, Federal Realty’s FFO came in at $4.31 per share. This exceeded the Zacks Consensus Estimate of $4.30 per share and the year-ago quarter figure of $4.00 per share.
Estimate Revisions
Over the last 60 days, the Zacks Consensus Estimate for full-year 2013 and 2014 has moved up by 0.7% and 0.4% to $4.58 and $4.89 per share, respectively.
Last week, a number of other REITs also crafted 52-week highs. These include Prologis Inc. (PLD) and CBRE Group Inc. (CBG).
Note: Funds from operations, a widely accepted and reported measure of REITs performance, are derived by adding depreciation, amortization and other non-cash expenses to net income.
CBRE GROUP INC (CBG): Free Stock Analysis Report
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WALGREEN CO (WAG): Free Stock Analysis Report
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