Analyst Adam Kramer from Morgan Stanley maintained a Hold rating on Equity Residential and keeping the price target at $76.50.
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Adam Kramer’s rating is based on several factors influencing Equity Residential’s stock performance. The company’s second-quarter results were in line with expectations, with normalized FFO per share meeting both Morgan Stanley estimates and consensus. Despite a positive revision in guidance for same-store revenue and occupancy rates, the overall rent growth, particularly new lease growth, fell short of expectations, which may temper investor enthusiasm.
Furthermore, while the company raised its 2025 normalized FFO guidance, the market’s reaction might be cautious due to the underperformance of apartments, including Equity Residential, within the REIT sector. The focus remains on lease growth expectations for the second half of the year, especially in regions like the West Coast, which have been under scrutiny this earnings season. These mixed signals contribute to the Hold rating, as the potential for outperformance is balanced by areas of concern.
In another report released yesterday, Wells Fargo also maintained a Hold rating on the stock with a $75.00 price target.