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Realty Income raises full-year adjusted operating-funds forecast

Realty Income raised its full-year forecast for adjusted funds from operations per share after a third-quarter increase. The property company reported higher revenue and net income, maintained high occupancy and invested in additional properties and financing. Its annual investment target remained unchanged, while adjusted operating funds per share exceeded the Zacks consensus estimate.

Economics & Markets··Morning
A wide view across a parking lot of maintained, occupied retail properties, representing the commercial portfolio behind Realty Income's raised adjusted operating-funds forecast.

Annual forecast rises after quarterly growth

Realty Income, the commercial property company, raised its full-year forecast for adjusted funds from operations to between 4.45 dollars and 4.46 dollars per share. That measure, known as AFFO, applies accounting adjustments to net income. Its quarterly AFFO per share increased 3.7 per cent to 1.12 dollars from 1.08 dollars a year earlier.[1]

The quarterly adjusted operating-funds result exceeded the 1.11 dollars per share expected in the Zacks consensus.[1], [2]

Revenue rose to 1,621.6 million dollars from 1,470.6 million dollars. Net income available to common shareholders increased to 403.9 million dollars from 315.8 million dollars, while earnings per share rose to 0.43 dollars from 0.35 dollars.[1]

High occupancy supports the rental portfolio

At September-end, Realty Income owned or held interests in 15,536 properties leased to 1,842 clients across 96 industries. Occupancy was 98.8 per cent, unchanged from the preceding quarter and above 98.7 per cent a year earlier. The weighted average remaining lease term was approximately 8.5 years. Annualized base rent on re-leased properties increased to 67.6 million dollars from 65.3 million dollars.[1]

Investment target remains at 10 billion dollars

The company invested 2,566.4 million dollars during the quarter, with its proportionate economic share totaling 2,230.3 million dollars. The initial weighted average cash yield was 6.8 per cent. Management retained its full-year investment-volume target of 10 billion dollars. During the quarter, common stock sales raised 472.5 million dollars, while a convertible bond issue raised 1 billion dollars in principal with a 2031 maturity.[1]

References

  1. News sourceRealty Income / PR NewswireRealty Income raises full-year AFFO-per-share guidance↩1↩2↩3↩4↩5
  2. News sourceZacksRealty Income adjusted funds from operations reach 1.12 dollars per share↩
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