NEW YORK (
) -- Stocks in the
real estate investment trust sector were mostly higher Thursday with shares of
Host Hotels & Resorts
up several percentage points.
There were a few laggards in the sector, however, despite the
major stock indexes surging nearly 2%, riding the momentum from
triumphant return to the
New York Stock Exchange
and investors' mounting confidence in global growth prospects after Ireland signaled it's willing to accept aid for its banks.
Among REITs bucking the upward trend Thursday was
Annaly Capital Management
CB Richard Ellis Group
Annaly Capital shares traded around 1% lower ahead of the closing bell. There didn't appear to be much news pressuring the stock, however, though the manager of real estate investment securities, including mortgages and collateralized mortgage obligations, disappointed Wall Street recently with core quarterly earnings per share of 60 cents, 7 cents below expectations.
>>REIT Earnings: Behind the Numbers
Analysts from Deutsche Bank maintained a buy rating on Annaly despite its earnings miss but lowered their price target by $2 to $20.
"The shortfall to our estimate was a result of lower-than-expected net interest income likely due to new capital being deployed towards the end of the quarter," the analysts noted.
ProLogis shares spiked in early trading but failed to hold onto those gains, trading below the unchanged mark toward the end of the day's session.
ProLogis, a Denver-based REIT that operates industrial distribution facilities, recently reported third-quarter core funds from operations of 15 cents per share, missing expectations by 3 cents.
Funds from operations, or FFO, is a performance figure used by REITs to define cash flow from operations. The metric removes the profit-reducing effect of depreciation.
The earnings miss led analysts from
to downgrade the REIT's shares to market perform, from outperform, noting that "PLD has addressed its near-term liquidity concerns through aggressive asset sales and capital raising initiatives, but leverage remains high, and we believe it will need to be reduced over time."
CB Richard Ellis, a Los Angeles-based commercial REIT, traded in negative territory on Thursday afternoon, struggling to tap into positive ground in the final minutes of trading.
CB Richard Ellis said Wednesday it was selected by
American International Group
to provide facilities, project management and advisory services for its global real estate occupancy portfolio.
Last month the REIT upped its fiscal 2010 earnings-per-share guidance. CB Richard Ellis now expects adjusted EPS in a range of 65 cents to 70 cents per share, in line with analysts' consensus call for EPS of 68 cents for fiscal 2010.
Among Thursday's gainers was
Host Hotels & Resorts. The lodging REIT saw its share price bid up 2.4% Thursday afternoon.
Host, which owns and operates hotels under the Four Seasons, W and Ritz-Carlton brands, among others, recently raised its fiscal 2010 earnings and revPAR (revenue per available room) guidance, and concurrently narrowed its fiscal year FFO guidance.
Host said it expects comparable hotel revPAR to increase 5.5% to 6.5%, while losses per share should be between 23 and 22 cents, with a net loss between $150 million and $137 million. FFO per share for the fiscal year was forecast between 67 cents and 69 cents.
Hudson Securities analyst Robert LaFleur told
recently he likes Host's business, strategy and management but feels the share price, above $15 since early October, already reflects the strong fundamentals and is fairly valued.
Kimco shares jumped 2.2% Thursday. The REIT recently topped quarterly expectations and forecast stronger full-year funds from operations.
Following the beat, analysts from
issued an upgrade on Kimco Realty shares to hold, from sell, citing its 107.7% jump in comparative year-to-date profits.
The REIT raised its full-year FFO guidance to a range between $1.17 and $1.19 per share, up from its previous forecast for 2010 FFO between $1.14 and $1.18 per share. Analysts expect Kimco to book FFO of $1.11 per share for the year.
Kimco, which owns and operates neighborhood and community shopping centers, said quarterly funds from operations declined year-over-year, though results topped expectations by a penny per share.
Macerich traded up nearly 3% on Thursday.
The shopping mall owner topped consensus estimates with quarterly FFO of $93.3 million, or 66 cents per share, despite weak revenue. FFO per share in the year-earlier period was 97 cents.
Still, the mall owner lowered the high end of its previously forecast fiscal 2010 FFO guidance, saying it now expects full year FFO in a range of $2.60 to $2.70 and earnings per share in the range of 5 cents to 15 cents. Analysts were looking for 2010 FFO of $2.66 and EPS of 14 cents.
Macerich attributed the revision to the anticipated reduction of its lease termination revenue, to $7 million, from $17 million. Through the end of the recent quarter, lease termination revenue was $6.6 million.
-- Written by Miriam Marcus Reimer in New York.
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