Jacked Targets by Many Analysts ; G&M A group of equity analysts on the Street raised their targets for Boardwalk Real Estate Investment Trust (
) following the release of better-than-anticipated second-quarter results.
Though same property new operating income fell 3.2 per cent year-over-year, Boardwalk reported funds from operations per unit of 75 cents, exceeding the consensus projection on the Street by 2 cents with growth in Ontario and Saskatchewan offsetting a decline in Quebec.
“Following three consecutive quarters of sequential erosion, stabilized revenue increased 80 basis points quarter-over-quarter. Improved occupancy was the primary driver,” said Michael Markidis of Desjardins Securities. “In-place rents and amortized incentive losses were largely unchanged. Several months into the reopening and in the midst of a seasonally strong leasing period, BEI seems confident that it will push overall average occupancy to over 97 per cent before yearend. This is 100 basis points higher than the average economic occupancy in 2Q21 (96.1 per cent) and, if achieved, should enable BEI to dramatically reduce incentives offered on new leases.”
Raising his 2021 FFOPU estimate to $2.89 (from $2.82), which sits at the high end of the REIT’s newly introduced guidance ($2.80–2.92), Mr. Markidis said he sees it “well-positioned to generate mid- to high-single-digit FFOPU growth in 2022 and 2023.”
Keeping a “buy” rating, he hiked his target for the REIT’s units to $55 from $47. The average is $51.75.
Others making changes include:
* Canaccord Genuity’s Brendon Abrams to $50 from $45 with a “hold” rating.
“We highlight that the unit price has performed exceptionally well year-to-date (up 40 per cent), a rally admittedly we had not forecasted and surpassed our expectations (code for “we were wrong”). However, given the strong unit price appreciation, we believe the units are fairly valued, and we are maintaining our HOLD rating,” he said.
* iA Capital Markets’ Frdric Blondeau to $55 from $47 with a “buy” rating.
* Scotia Capital analyst Mario Saric to $51.25 from $43.50 with a “sector perform” rating
* National Bank’s Matt Kornack to $56 from $51.50 with an “outperform” rating.
* RBC to $54 from $44 with an “outperform” rating.