"The suburban office portfolio had been one of the biggest drags for the stock, but tenant move-outs should wane in 2016 and the negative mark-to-market moderates," KeyBanc analysts said.
The company completed more than $200 million of acquisitions in the first quarter 2015, with an additional $150 million under contract, according to the analyst note.
Lexington Realty Trust continues to source accretive acquisitions that are being financed with dispositions, KeyBanc added.
Additionally, Lexington Realty Trust is on its track to reach 2015 disposition target of $300 million to $350 million given first quarter sales and assets in the market, KeyBanc noted.
Lexington Realty Trust is a self-managed and self-administered real estate investment trust (REIT) that owns a portfolio of equity and debt investments in single-tenant properties and land.
Separately, TheStreet Ratings team rates LEXINGTON REALTY TRUST as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate LEXINGTON REALTY TRUST (LXP) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth and reasonable valuation levels. However, as a counter to these strengths, we find that we feel that the company's cash flow from its operations has been weak overall."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- LEXINGTON REALTY TRUST has shown improvement in its earnings for its most recently reported quarter when compared with the same quarter a year earlier. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, LEXINGTON REALTY TRUST turned its bottom line around by earning $0.17 versus -$0.18 in the prior year. This year, the market expects an improvement in earnings ($0.40 versus $0.17).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income increased by 3681.6% when compared to the same quarter one year prior, rising from $0.89 million to $33.51 million.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. When compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, LEXINGTON REALTY TRUST's return on equity is below that of both the industry average and the S&P 500.
- Net operating cash flow has declined marginally to $57.92 million or 3.37% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, LEXINGTON REALTY TRUST has marginally lower results.
- You can view the full analysis from the report here: LXP Ratings Report