Brixmor Property Group: Occupancy And NOI Rising, The Stock Will Follow

seekingalpha05-04

Brixmor Property Group increased its NAREIT FFO (+2.7% vs. 2023) and NOI (+3.9%) 2024 growth guidance.The company's improving occupancy, rising net operating income, and attractive market cap rate ...

Source Link

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap

Leave a comment

{"i18n":{"language":"en_US"},"isChannel":false,"data":{"share":"https://ttm.financial/m/news/2432858491?lang=en_US&edition=fundamental","thumbnail":"https://static.seekingalpha.com/cdn/s3/uploads/getty_images/1257382932/image_1257382932.jpg","is_english":true,"pubTime":"2024-05-04 00:35","share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","id":"2432858491","market":"us","top_or_hot":-1,"title":"Brixmor Property Group: Occupancy And NOI Rising, The Stock Will Follow","media":"seekingalpha","content":"<div>\n<p>Brixmor Property Group increased its NAREIT FFO (+2.7% vs. 2023) and NOI (+3.9%) 2024 growth guidance.The company's improving occupancy, rising net operating income, and attractive market cap rate ...</p>\n\n<a href=\"https://seekingalpha.com/article/4689129-brixmor-property-group-occupancy-and-noi-rising-stock-will-follow\">Source Link</a>\n\n</div>\n","source":"seekingalpha","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Brixmor Property Group: Occupancy And NOI Rising, The Stock Will Follow</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nBrixmor Property Group: Occupancy And NOI Rising, The Stock Will Follow\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-05-04 00:35 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4689129-brixmor-property-group-occupancy-and-noi-rising-stock-will-follow><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Brixmor Property Group increased its NAREIT FFO (+2.7% vs. 2023) and NOI (+3.9%) 2024 growth guidance.The company's improving occupancy, rising net operating income, and attractive market cap rate ...</p>\n\n<a href=\"https://seekingalpha.com/article/4689129-brixmor-property-group-occupancy-and-noi-rising-stock-will-follow\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK4585","symbol_name":"ETF&股票定投概念","start_time":0,"source_url":"https://seekingalpha.com/article/4689129-brixmor-property-group-occupancy-and-noi-rising-stock-will-follow","article_id":"2432858491","we_media_id":null,"thumbnails":["https://static.seekingalpha.com/cdn/s3/uploads/getty_images/1257382932/image_1257382932.jpg"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2432858491","pubTimestamp":1714754112,"sourceInfo":{"source_id":"seekingalpha","name":"Seeking Alpha"},"weMediaInfo":null,"summary":"Brixmor Property Group increased its NAREIT FFO (+2.7% vs. 2023) and NOI (+3.9%) 2024 growth guidance.The company's improving occupancy, rising net operating income, and attractive market cap rate mak","collect":0,"end_time":0,"defaultTopTitle":"seekingalpha.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK4585":"ETF&股票定投概念","BK6027":"贸易公司与经销商","BK4588":"碎股","BK6000":"餐馆","VNQ":"不动产信托指数ETF-Vanguard","BK6520":"工商业服务概念","BRX":"Brixmor Property Group Inc.","BK6509":"食品和饮料股","BK4080":"零售业房地产投资信托","CFA.SI":"NikkoAM-STC Asia REIT","BK4231":"零售房地产信托","533.SI":"ABR"},"translate_title":"Brixmor房地产集团：入住率和NOI上升，股票将紧随其后","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"BRX":1,"CFA.SI":1,"RS1.SI":1,"VNQ":1,"533.SI":0.6},"content_text":"Brixmor Property Group increased its NAREIT FFO (+2.7% vs. 2023) and NOI (+3.9%) 2024 growth guidance.The company's improving occupancy, rising net operating income, and attractive market cap rate make its shares look very attractive.Brixmor enjoys a very strong standing with anchor tenants, with anchor releasing spreads a key NOI driver.Occupancy with smaller shops is less robust, which is one of the key risks, along with lack of complementary metrics to evaluate the sustainability of NOI growth.Net debt accounts for just 42% of enterprise value, with low fixed-rates locked in for the medium term.Luis Alvarez Introduction Brixmor Property Group Inc. (NYSE:BRX) has marginally outperformed the Vanguard Real Estate Index Fund ETF Shares (VNQ) so far in 2024: BRX vs VNQ in 2024 (Seeking Alpha) Even so, the stock is still down in 2024 despite increasing its 2024 outlook and delivering exceptional operating results. With improving occupancy, rising net operating income, and a 7.9% market cap rate coupled with modest leverage, the shares look very attractive, and hence I rank them a buy. Company Overview You can access all company results here. Brixmor Property Group is a retail REIT operating 359 retail centers across the US, with Philadelphia (7.4% of annualized base rent, or ABR), New York (7%) and Chicago (5.6%) the company's largest markets. 75% of shopping centers are grocery-anchored, with Grocery/Pharmacy accounting for 15% of ABR, marginally behind Restaurants at 17% of ABR: Tenant exposure breakdown (Brixmor Property Group Q1 2024 Supplemental Disclosure) Operational Overview Brixmor reported a NAREIT FFO of 0.54/share in Q1 2024, up 8% Y/Y. Occupancy increased to 95.1%, up 1.1% Y/Y. Net operating income increased 5.9% Y/Y. The excellent quarterly performance was driven by higher revenues, flat operating expenses, and marginally higher interest expenses. Other than redevelopments, a key revenue driver remains leasing spreads, with old expiring leases substantially below current market rates, especially for anchor tenants: Anchor tenant releasing potential (Brixmor Property Group Q1 2024 Fact Sheet) Updated 2024 Outlook Given the exceptional start of the year, the company updated its previously provided NAREIT FFO per diluted share expectations for 2024 to $2.08 - $2.11 (previously $2.06 - $2.10) and same property NOI growth expectations for 2024 to 3.50% - 4.25% (previously 2.50% - 3.50%): Updated 2024 Outlook (Brixmor Property Group Q1 2024 Results Press Release) As a result, NAREIT FFO is now expected to increase about 2.7% relative to 2023. Debt Position Brixmor Property Group ended Q1 2024 with a net debt of $4.9 billion, implying net debt accounts for just 42% of the company's enterprise value. The company's debt is entirely fixed-rate, with a well-laddered maturity structure: Debt Maturity Profile (Brixmor Property Group Q1 2024 Supplemental Disclosure) From the data above we observe that just 6% of debt matures in 2024, followed by 13% in 2025. The weighted average interest rate is also very low, at just 3.86%, implying the company will benefit from low locked-in rates for years to come. That said, the most recent offering of 10-year debt in 2024 was priced at about 5.50%, implying marginal refinancing pressure as historic low-rate debt matures. Likewise, the company's unutilized floating rate revolver offers financing at 6.29%. Market-implied cap rate For 2024, I expect Brixmor to generate net operating income of about $922 million, implying the REIT currently trades at a market-implied cap rate of about 7.9%, which is very attractive given the strong NOI growth rate coming from releasing and redevelopments. Even more encouraging, general and administrative expenses were flat Y/Y in Q1 2024. In 2023, the company spent $117 million on such expenses. If the Q1 trend persists, these expenses will represent a 0.7% drag on the market cap rate, resulting in a 7.2% market cap rate post general and administrative expenses, which again I see as highly attractive given positive occupancy and NOI momentum. Risks From a financial and operational standpoint, I don't see major red flags concerning Brixmor Property Group. Some points to note, however, are that while the overall occupancy of 95.1% is robust for a retail REIT, it is the result of two occupancy metrics - anchor occupancy at 97.3% at the end of Q1 2024, and small shop occupancy of 90.5%. While both metrics improved year-over-year, the small shop occupancy points to a weaker standing of Brixmor with non-anchor retailers. Furthermore, while NOI growth of 3.5-4.25% is robust in itself, the company does not report additional metrics such as tenant sales and footfall which would complement NOI trends. In essence, the sustainability is above-inflation NOI growth is hard to determine when we don't know if tenant sales are growing above inflation/national sales indices, respectively whether footfall is outperforming the national/local average. Conclusion Brixmor Property Group stock is down in 2024 despite increasing its guidance, with the company offering an attractive market cap rate of 7.9% and an above-average NOI growth for the foreseeable future. Furthermore, the company's debt is well-staggered, with Brixmor benefitting from low fixed rates in the years to come. As a result, I fully expect the company to generate excellent results for shareholders and rank the shares a buy.  Thank you for reading.","kind":null,"is_publish_news":null,"is_publish_highlight":null,"is_publish_live":null,"is_publish_wemedia":null,"editions":null,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.22.4","shortVersion":"4.22.4","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2432858491"}