Equity Residential Sees 5.4% Revenue Increase but Lags Market

Equity Residential reports a 5.4% revenue growth, but the stock is slightly lagging behind broader market trends. While the overall stock performance remains modest, analysts maintain a consensus rating of 'Moderate Buy'.

Date: 17-02-2025

AI Rating: 7

Revenue Growth: Equity Residential has reported a 5.4% year-over-year increase in total revenues for the last quarter, reaching $766.8 million. This growth surpassed Street expectations by 1.2%, indicating strong market performance.

Net Income: The company's net income also saw a significant rise, up 34.7% year-over-year to $418.8 million, further enhancing its appeal to investors.

Normalized Funds from Operations (NFFO): The NFFO of $1 per share matched analysts' consensus estimates, reflecting consistency in performance. For fiscal 2025, EQR is expected to deliver a modest NFFO per share growth of 2.3%, which also indicates stability and predictability in earnings.

Despite these positive points, Equity Residential's stock has lagged behind the broader market and the iShares Global REIT ETF over the past year. The report mentions a slight dip of 74 basis points on a year-to-date basis, while the S&P 500 has surged 22.3% in the same period. This might affect investor sentiment negatively, as they tend to favor stocks that outpace market growth.

The consensus rating of 'Moderate Buy' among analysts, with 11 'Strong Buy', 1 'Moderate Buy', and 15 'Hold' recommendations, suggests a generally positive outlook for EQR, even as the stock might not be achieving impressive short-term gains.

Furthermore, Evercore ISI's analyst reiterated a 'Hold' rating, with a price target that indicates a potential upside. The mean price target suggests an 8.7% premium to the current price levels, signaling a cautious optimism but without strong conviction for aggressive buy recommendations.

Stocks: EQR SPX REET