Essex Property Trust (ESS) Up 4.2% Since Last Earnings Report: Can It Continue?

A month has gone by since the last earnings report for Essex Property Trust (ESS). Shares have added about 4.2% in that time frame, outperforming the S&P 500.Will the recent positive trend continue leading up to its next earnings release, or is Essex Property Trust due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers. Essex Property Q4 FFO Beats Estimates, Revenues Increase Y/YEssex Property reported fourth-quarter 2024 core FFO per share of $3.92, which beat the Zacks Consensus Estimate of $3.90. The figure also improved 2.3% from the year-ago quarter.Results reflected favorable growth in same-property revenues and NOI. Essex Property issued first-quarter and full-year 2025 guidance for core FFO per share.Total revenues of $454.5 million outpaced the Zacks Consensus Estimate of $453.1 million. Revenues were up 7.8% year over year.For full-year 2024, core FFO per share came in at $15.60, improving by 3.8% year over year. The reported figure beat the Zacks Consensus Estimate by two cents. This was backed by 6.3% growth in revenues to $1.77 billion.Quarter in DetailIn the fourth quarter, Essex Property’s same-property revenues increased 2.6% from the prior-year period, below our estimate of 5.6%. The same-property operating expenses rose 4.7% year over year versus our estimate of 7.5%.The same-property NOI increased 1.7% year over year, below our estimate of 4.8%. Financial occupancies of 95.9% in the fourth quarter fell 20 basis points (bps) year over year and 30 bps sequentially. The metric came below our estimate of 96.1%.Portfolio ActivityIn October, Essex Property acquired a 49.9% joint venture partner’s interest in the BEX II portfolio, with four communities consisting of 871 apartment units, for $337.5 million on a gross basis ($168.4 million at pro rata). In November, it acquired another community, Beaumont, with 344 apartment units in Woodinville, WA, for $136.1 million.In October, the company disposed of its 81.5% interest in an apartment community in San Mateo, CA, for $252.4 million on a gross basis ($205.7 million at pro rata).Balance SheetEssex Property had $1.3 billion in liquidity through the undrawn capacity on its unsecured credit facilities, cash and cash equivalents and marketable securities as of Dec. 31, 2024. Essex Property exited the fourth quarter of 2024 with cash and cash equivalents, including restricted cash, of $75.8 million, down from the $80.3 million recorded at the end of the prior quarter.During the fourth quarter, Essex Property neither issued any shares of common stock through its equity distribution program nor repurchased any shares through its stock repurchase plan.GuidanceFor the first quarter of 2025, Essex Property projects core FFO per share in the range of $3.86-$3.98, with the midpoint being $3.92.For full-year 2024, the company projects the core FFO per share in the range of $15.56-$16.06, with the midpoint being $15.81.The full-year guidance is based on projections for the same-property revenue growth of 2.25-3.75%, an operating expense increase of 3.25-4.25% and an NOI expansion of 1.4-4.0%.How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a downward trend in fresh estimates.VGM ScoresAt this time, Essex Property Trust has a poor Growth Score of F, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookEstimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Essex Property Trust has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.Performance of an Industry PlayerEssex Property Trust belongs to the Zacks REIT and Equity Trust - Residential industry. Another stock from the same industry, Equity Residential (EQR), has gained 2.4% over the past month. More than a month has passed since the company reported results for the quarter ended December 2024.Equity Residential reported revenues of $766.78 million in the last reported quarter, representing a year-over-year change of +5.4%. EPS of $1.10 for the same period compares with $1 a year ago.Equity Residential is expected to post earnings of $0.94 per share for the current quarter, representing a year-over-year change of +1.1%. Over the last 30 days, the Zacks Consensus Estimate has changed +0%.Equity Residential has a Zacks Rank #4 (Sell) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.Only $1 to See All Zacks' Buys and SellsWe're not kidding.Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent.Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators,and more, that closed 256 positions with double- and triple-digit gains in 2024 alone.See Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Essex Property Trust, Inc. (ESS): Free Stock Analysis Report Equity Residential (EQR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks