The St. Joe Company (JOE) is making concerted efforts to maximize shareholder value by focusing on its residential resort communities, primary homes and the active adult residential market. The company is now reaping benefits from the commencement of its private membership club, St. Joe Club & Resorts that was done in first-quarter 2014.
Also, St. Joe is exploring potential opportunities to sell assets that are not a strategic fit to the company's core real estate development activities such as residential lots, timber land, rural land and/or related timber rights. On the other hand, the company continues to explore new commercial and industrial uses for its land portfolio. Notably, a significant amount of the company’s land is strategically positioned near the Northwest Florida Beaches International Airport and the coast of Gulf of Mexico.
In August, St. Joe reported second-quarter 2014 earnings per share of 16 cents, thanks to the sale of the RiverTown community. The company had earned 3 cents per share in the year-ago quarter. The Zacks Consensus Estimate, excluding one-time items, was earnings of one cent per share. St. Joe’s total revenue for the quarter came in at $68.2 million, with the RiverTown sale, accounting for $43.6 million. The company had reaped revenues of $33.8 million in the year-ago quarter.
However, St. Joe experienced a decline in revenue from timber sales in second-quarter 2014, propelled by the AgReserves sale that closed in Mar 2014. As a result of the AgReserves sale, the company does not expect to get substantial revenues from sales of timber or rural lands, going forward, and, the company anticipates experiencing decline in gross profit margins in the future as well.
To gain deeper insight into St. Joe, you can refer to our updated research report, which was issued on Sep 10, 2014.
Over the last 30 days, the Zacks Consensus Estimate for 2014 jumped from a loss of 2 cents to earnings of $4.38 per share. For 2015, it remained stable at 12 cents per share. The stock currently has a Zacks Rank #1 (Strong buy).
Stocks That Warrant a Look
Investors interested in the real estate industry may also consider stocks like CBRE Group, Inc. (CBG), Jones Lang LaSalle Incorporated (JLL) and Henderson Land Development Co. Ltd. (HLDCY). All these stocks carry a Zacks Rank #2 (Buy).
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