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Vornado Realty (VNO)
NYSE:VNO
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Vornado Realty
(NYSE:VNO)
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Select Model
Rating:55Neutral
Price Target:
$29.00
▲(1.33% Upside)
Action:ReiteratedDate:02/10/26
The score is held back mainly by pressured financial quality (revenue decline and leverage) and weak technical momentum (below major moving averages with negative MACD). Offsetting these are attractive valuation (low P/E) and a generally positive earnings-call backdrop on leasing/occupancy and balance-sheet actions, though 2026 guidance remains flat with near-term interest and cash NOI headwinds.
Positive Factors
Strong Manhattan leasing and rent re-pricing
Sustained, high-volume leasing in Manhattan and double-digit mark-to-market gains indicate durable tenant demand and pricing power in Vornado's core market. Long average lease terms (>11 yrs) lock in higher cash flows and reduce vacancy risk, supporting long-term revenue recovery and FFO upside as free-rent burnoff completes.
Penn District lease-up momentum and asset quality
Rapid lease-up at PENN1/PENN2 with high starting rents materially increases future cash NOI and reduces project execution risk. Completing these marquee properties upgrades portfolio quality, concentrates higher-quality cash flows, and supports medium-term earnings growth as remaining vacancies convert to stabilized income.
Material liquidity and successful maturity extensions
Meaningful cash and revolver capacity plus executed maturity extensions and new unsecured debt materially reduce near-term refinancing pressure. This structural improvement in liquidity and tenor lowers default risk, gives management time to lease up developments, and stabilizes capital allocation decisions over the 2–4 year horizon.
Negative Factors
Elevated leverage and balance-sheet sensitivity
High leverage leaves limited room for rate shocks or additional borrowing, increasing refinancing and covenant risk. Even with recent extensions, elevated net-debt/EBITDA and historically large debt burdens constrain capital flexibility, amplify interest-cost sensitivity, and limit the firm's ability to pursue opportunistic investments without deleveraging.
Sharp revenue decline reduces operating resilience
A significant revenue contraction undermines scale economics for an office REIT, pressuring fixed-cost absorption and masking true operating trends. Volatile annual earnings and reliance on non-recurring items make cash flow less predictable, complicating long-term planning and increasing reliance on successful redevelopment and lease-ups to restore prior revenue levels.
Near-term cash NOI pressure from free rent and timing of GAAP recognition
Generous free-rent concessions, while supporting leasing, depress near-term cash NOI and free cash flow. The timing gap between signed leases and GAAP recognition adds modeling uncertainty; until commencements and TI work complete, cash recoveries will lag, leaving short-term FFO and coverage metrics vulnerable despite long-term leasing gains.
Vornado Realty (VNO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$5.78B
Dividend Yield2.24%
Average Volume (3M)1.99M
Price to Earnings (P/E)6.6
Beta (1Y)1.27
Revenue Growth2.41%
EPS GrowthN/A
CountryUS
Employees2,996
SectorReal Estate
Sector Strength53
IndustryREIT - Office
Share Statistics
EPS (TTM)0.00
Shares Outstanding190,666,370
10 Day Avg. Volume2,788,831
30 Day Avg. Volume1,985,955
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)1.07
Price to Sales (P/S)3.52
P/FCF Ratio5.07
Enterprise Value/Market Cap2.16
Enterprise Value/Revenue6.91
Enterprise Value/Gross Profit6.91
Enterprise Value/Ebitda7.08
Forecast
1Y Price Target
$35.80Price Target Upside25.09% Upside
Rating ConsensusHold
Number of Analyst Covering11
EPS Forecast (FY)0.12
Revenue Forecast (FY)$1.88B
Vornado Realty Business Overview & Revenue Model
Company DescriptionVornado's portfolio is concentrated in the nation's key market New York City along with the premier asset in both Chicago and San Francisco. Vornado is also the real estate industry leader in sustainability policy. The company owns and manages over 23 million square feet of LEED certified buildings and received the Energy Star Partner of the Year Award, Sustained Excellence 2019. In 2012, Vornado commemorated 50 years on the NYSE.
How the Company Makes MoneyVornado Realty generates revenue primarily through leasing its commercial and residential properties to tenants, which provides a steady stream of rental income. The company also earns money through property management and development activities, including renovation and construction projects that enhance property value. Additionally, Vornado may engage in strategic partnerships and joint ventures to maximize returns on its investments. The firm benefits from long-term leases, which provide predictable cash flows, and its focus on prime locations attracts high-profile tenants, contributing to its overall financial performance.
Vornado Realty Earnings Call Summary
Earnings Call Date:Feb 09, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 04, 2026
Earnings Call Sentiment Positive
The call emphasized pronounced operational momentum in Manhattan: robust leasing (4.6M sq ft in 2025), rising market rents and strong penn district lease-up progress, improved occupancy (91.2%), higher GAAP NOI (+5% quarter) and significantly strengthened liquidity and maturities. Offsetting items include a Q4 FFO dip due to higher interest expense, same-store cash NOI down 8.3% driven by free rent, near-term flat FFO guidance for 2026 (with growth expected in 2027), and timing uncertainty on GAAP recognition of signed rents (~$200M). Management presented a constructive and confident tone on fundamentals, active capital allocation (select buybacks, refinancings, development), and improving leverage metrics. Overall, positives appear to meaningfully outweigh the near-term, largely timing-related negatives.Q4-2025 Updates
Positive Updates
Strong Leasing Volume in 2025
Leased 4,600,000 square feet in 2025 (3,700,000 in Manhattan, 146,000 in San Francisco, 394,000 in Chicago). Highest Manhattan leasing in over a decade and second-highest year on record. Excluding a 1,100,000 sq ft NYU master lease, Manhattan average starting rent was $98/sf with an average lease term of over 11 years.
High-Value Leasing and Mark-to-Markets
Mark-to-markets for 2025 were +10.4% GAAP and +7.8% cash (Manhattan). Fourth quarter mark-to-markets were +8.1% GAAP and +7.2% cash. Executed 46 leases at $100+/sf totaling 2,500,000 sq ft (about two-thirds of activity).
Penn District Momentum (PENN1 & PENN2)
PENN2: 908,000 sq ft leased in 2025 at an average of $109/sf; Q4 leased 231,000 sq ft at $114/sf (avg term >13 years). PENN2 now >1,400,000 sq ft leased since inception and at ~80% occupancy; management expects lease-up to finish this year. PENN1: since redevelopment start leased >1,700,000 sq ft at an average $94/sf; remaining vacancy: PENN2 ~348,000 sq ft, PENN1 ~177,000 sq ft.
Improving Occupancy
Company-wide office occupancy rose from 88.8% to 91.2% year-over-year. New York office occupancy increased to 91.2% (from ~88.4% last quarter), reflecting substantial leasing activity, principally in the Penn District.
NOI and FFO (GAAP vs Cash)
Same store GAAP NOI was up 5% for the quarter. Comparable FFO for the full year was $2.32 per share, slightly higher than 2024. Management emphasizes GAAP metrics are more relevant given heavy recent leasing and free rent impacts on cash numbers.
Balance Sheet Liquidity and Refinancing
Liquidity of $2.39 billion (cash $978M, credit lines $1.41B). Extended maturities through Feb 2031 on nearly $3.5B of debt, refinanced unsecured term loan to $850M (matures Feb 2031), upsized/extended revolvers ($1.13B maturing Feb 2031 and $1.0B maturing Apr 2029), and completed a $500M seven-year unsecured bond at 5.75%.
Leverage Metrics Improving
Net debt to EBITDA improved from 8.6x at the start of the year to 7.7x; fixed charge coverage is steadily rising. S&P changed the company's credit outlook from negative to stable and affirmed the unsecured rating.
Share Repurchases
Bought back 2,352,000 shares for $80M at an average price of ~$34 in recent months; since 2023 authorization repurchased 4,376,000 shares for $109M (avg ~$25/share). Management signals willingness to be more aggressive if disconnect with NAV persists.
Active and High-Potential Development Pipeline
350 Park Ave (1.85M sq ft) construction to commence in April with Ken Griffin/Citadel participation; project expected to deliver 2027. Acquired 623 Fifth Ave (≈383,000 sq ft) for $218M ($569/sf) targeting a high-end redeveloped product; projected incremental cash yield increased from 10.2% to 11.6% (supplement p.22). Closed on a 141M acquisition of 3 W 54th St development site and progressing on a 475-unit rental at 34th St.
New Uses and Amenities Driving Demand
Opened amenity spaces ('The Perch' at PENN2 and rooftop pavilion at 1290 Avenue of the Americas) that have been well received by tenants. Sunset Pier 94 (50% owned) opened six sound stages immediately leased to Paramount and Netflix (short-term leases).
Negative Updates
Quarterly Comparable FFO Decline
Fourth quarter comparable FFO was $0.55 per share versus $0.61 in Q4 2024 (≈ -9.8%). The decrease was primarily due to higher net interest expense and the absence of prior-year lease termination income (330 West 34th) that benefited the prior quarter.
Same Store Cash NOI Pressure
Same store cash NOI was down 8.3% for the quarter, driven by significant free rent tied to recent leasing activity and cash rent adjustments (including Penn1 ground lease effects). Management expects cash NOI to inflect in H2 2026 as free rent burns off.
Near-Term FFO Guidance and Earnings Timing
Management expects 2026 comparable FFO to be in line with 2025 (flat) due to anticipated non-core asset sales taking income offline, higher interest expense from recent financings, and seasonality in the signage business. First quarter 2026 will be more impacted; significant earnings growth is expected in 2027 as PENN1/PENN2 leases ramp.
Signed Rents Not Yet GAAP-Recognized
Management identified a ~$200,000,000 difference between leased (signed) rents and GAAP-recognized rents representing committed gross rents that will be recognized over the next several years; timing uncertainty complicates near-term modeling and GAAP recognition depends on tenant build-outs and commencements.
Construction and TI Cost Pressure
Management noted materially higher construction costs (citing ~ $2,500/sf to build a new Manhattan tower) and indicated tenant improvement (TI) costs are 'sticky'—limiting downside in inducements even as rents rise. These higher build/TI costs make new development economics tighter.
Sunset Pier 94 Yield Reset and Short-Term Leases
Projected cash yield on Sunset Pier 94 declined (example cited from ~10% to ~9%) as streaming/tenant dynamics proved more challenged and initial leases are short-term; management labeled the revised yield as 'reality'-driven.
Stock Price Disconnect and Cautious Buyback Posture
Management highlighted a substantial disconnect between stock price and NAV despite strong fundamentals; while buybacks have begun, they will be executed 'with care' to avoid harming the balance sheet. The company acknowledged recent declines in REIT stocks broadly.
Uncertainty Around Third-Party Events
Saks Fifth Avenue bankruptcy outcome remains uncertain; management views potential outcomes as likely neutral-to-positive for their 623 Fifth Ave redevelopment but the bankruptcy introduces timing/tenant risk tied to the retail base underneath the asset.
Higher Interest Expense Near Term
Recent refinancings and bond issuance increased near-term interest expense (noted as a contributor to Q4 FFO decline and to create more impact in Q1), although these moves extended maturities and improved liquidity.
Company Guidance
Management guided that 2026 comparable FFO should be roughly in line with 2025 (2025 comparable FFO = $2.32/share; Q4 ’25 comparable FFO = $0.55 vs $0.61 LY), with Q1 2026 more pressured by GAAP rent ramp, higher interest (including a $500M 7‑yr bond at 5.75%) and signage seasonality, and significant earnings growth expected in 2027 as PENN1/PENN2 lease‑ups ramp. Key metrics behind that outlook: 2025 leasing of 4.6M sq ft (3.7M Manhattan), Q4 NY deals = 25 deals / 960k sq ft at $95/sf avg (Q4 mark‑to‑markets +8.1% GAAP / +7.2% cash; avg term 10 yrs), Manhattan avg starting rent (ex‑NYU) $98/sf with mark‑to‑markets +10.4% GAAP / +7.8% cash and avg lease term >11 yrs; PENN2 now ~80% leased (1.4M+ sq ft) with 2025 PENN2 leasing 908k sq ft at $109/sf avg and projected incremental cash yield raised from 10.2% to 11.6%. They cautioned modelers not to assume more than a $0.40 uptick in 2027, noted >$200M of signed but not‑GAAP‑recognized rent to be recognized over the next few years, reported liquidity of $2,390M (cash $978M + $1,410M credit lines), nearly $3.5B of maturities extended (many to 02/2031), net debt/EBITDA improved to 7.7x from 8.6x, and confirmed ongoing share buybacks (total 4.376M shares for $109M since 2023; recent 2.352M shares for $80M at ~$34).Vornado Realty Financial Statement Overview
Summary
Profitability and current cash generation are strengths (very strong TTM margins and positive operating/free cash flow), but the setup is constrained by sharp revenue decline, historically volatile earnings, and a leveraged balance sheet that increases rate/refinancing sensitivity.Income Statement
TTM (Trailing-Twelve-Months) profitability screens very strong (net margin ~50% and EBIT margin ~72%), but revenue is down sharply (~-22.5%), which is a key concern for an office REIT. Annual results show volatile earnings: modest profits in 2023–2024 after sizable losses in 2020 and 2022, suggesting results are being influenced by non-recurring items and/or property-level swings rather than steady operating momentum.53
Neutral
Balance Sheet
Leverage looks elevated on the annual balance sheets, with debt running well above equity (debt-to-equity roughly ~1.4–1.7 in 2021–2024), which reduces flexibility in a higher-rate environment. Equity returns have generally been low to negative historically, improving to mid-teens in TTM (Trailing-Twelve-Months) but with mixed balance-sheet signals (e.g., TTM debt shown as 0 while the ratio implies leverage), so overall balance-sheet quality appears more pressured than peers with lower leverage.41
Neutral
Cash Flow
Cash generation is a relative strength: operating cash flow and free cash flow are positive across most years and step up materially in TTM (Trailing-Twelve-Months). That said, cash flow trends are choppy (free cash flow down in 2023–2024 and sharply negative growth in TTM), and in several years operating cash flow covered net income by well under 1x, implying earnings quality can be uneven.62
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.81B | 1.79B | 1.81B | 1.80B | 1.59B |
| Gross Profit | 1.81B | 1.79B | 906.00M | 926.08M | 791.89M |
| EBITDA | 1.77B | 880.61M | 845.61M | 423.31M | 840.50M |
| Net Income | 904.96M | 70.39M | 105.49M | -346.50M | 176.00M |
Balance Sheet | |||||
| Total Assets | 15.52B | 16.00B | 16.19B | 16.49B | 17.27B |
| Cash, Cash Equivalents and Short-Term Investments | 840.85M | 733.95M | 997.00M | 1.36B | 1.76B |
| Total Debt | 7.89B | 8.99B | 8.98B | 9.13B | 8.99B |
| Total Liabilities | 8.72B | 9.83B | 9.84B | 9.98B | 10.06B |
| Stockholders Equity | 5.99B | 5.16B | 5.51B | 5.84B | 6.24B |
Cash Flow | |||||
| Free Cash Flow | 1.26B | 537.72M | 648.15M | 798.94M | 761.81M |
| Operating Cash Flow | 1.26B | 537.72M | 648.15M | 798.94M | 761.81M |
| Investing Cash Flow | 115.51M | -597.37M | -128.79M | -906.86M | -532.35M |
| Financing Cash Flow | -1.35B | -252.32M | -278.94M | -801.27M | -29.48M |
Vornado Realty Technical Analysis
Negative
28.62
Price Trends
32.13
Negative
34.23
Negative
36.21
Negative
Market Momentum
-1.12
Positive
37.03
Neutral
11.38
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VNO, the sentiment is Negative. The current price of 28.62 is below the 20-day moving average (MA) of 30.12, below the 50-day MA of 32.13, and below the 200-day MA of 36.21, indicating a bearish trend. The MACD of -1.12 indicates Positive momentum. The RSI at 37.03 is Neutral, neither overbought nor oversold. The STOCH value of 11.38 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for VNO.
Vornado Realty Risk Analysis
Vornado Realty disclosed 42 risk factors in its most recent earnings report. Vornado Realty reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Vornado Realty Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
57 Neutral | $3.71B | 13.39 | 5.09% | 5.75% | 0.77% | 62.58% | |
56 Neutral | $2.54B | 16.22 | 6.73% | 7.83% | -2.10% | -13.30% | |
55 Neutral | $5.78B | 6.64 | 16.24% | 2.24% | 2.41% | ― | |
53 Neutral | $3.88B | 96.08 | 0.85% | 5.08% | 16.38% | 3.60% | |
52 Neutral | $10.36B | 34.15 | 5.24% | 5.26% | 2.54% | -155.17% | |
48 Neutral | $2.78B | -23.45 | -2.25% | 6.95% | 8.60% | ― |
* Real Estate Sector Average
VNO
Vornado Realty
29.18
-10.93
-27.25%
BXP
BXP
61.17
-6.24
-9.25%
CUZ
Cousins Properties
23.97
-4.84
-16.81%
HIW
Highwoods Properties
23.42
-3.36
-12.54%
KRC
Kilroy Realty
32.02
-1.97
-5.80%
SLG
SL Green Realty
39.32
-22.36
-36.25%
Vornado Realty Corporate Events
Private Placements and Financing
Vornado Realty Completes $500 Million Senior Notes Offering
Positive
Jan 14, 2026
On January 14, 2026, Vornado Realty L.P., the operating partnership of Vornado Realty Trust, completed an underwritten public offering of $500 million aggregate principal amount of 5.750% notes due 2033 under an effective shelf registration statement, reinforcing its access to public debt markets and providing long-term capital for its real estate operations. The transaction, underwritten by a syndicate led by BofA Securities, PNC Capital Markets, U.S. Bancorp Investments and Wells Fargo Securities, was supported by legal opinions from Sullivan & Cromwell LLP on the validity of the notes and from Venable LLP on matters relating to Vornado Realty Trust, underscoring the formalization and legal robustness of the financing move for stakeholders.
The most recent analyst rating on (VNO) stock is a Hold with a $36.00 price target. To see the full list of analyst forecasts on Vornado Realty stock, see the VNO Stock Forecast page.
Business Operations and StrategyPrivate Placements and Financing
Vornado Realty Extends Debt Maturities and Boosts Liquidity
Positive
Jan 7, 2026
On January 7, 2026, Vornado Realty L.P. amended and extended one of its revolving credit facilities, pushing the fully extended maturity from December 2027 to February 2031 while reducing its borrowing capacity from $1.25 billion to $1.105 billion, and updated pricing tied to Term SOFR and modest sustainability-linked adjustments to interest and facility fees. On the same date, the partnership extended the maturity of its term loan from December 2027 to February 2031 and increased the loan size to $850 million, and also raised commitments on another unsecured revolving credit facility maturing in April 2029 from $915 million to $1.0 billion, while maintaining a framework of leverage, coverage and unsecured/secured debt covenants; these moves collectively extend its debt maturities, refine liquidity, and reinforce balance sheet discipline under customary default and covenant structures important to creditors and other financial stakeholders.
The most recent analyst rating on (VNO) stock is a Hold with a $36.00 price target. To see the full list of analyst forecasts on Vornado Realty stock, see the VNO Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.