Equity Residential (NYSE: EQR) stock rose over 3% on 24th October, 2018 (as of 11:56 AM GMT-4; Source: Google finance) after the company posted better than expected results for the third quarter of 2018. During the third quarter of 2018, the Company acquired three apartment properties, including two in Denver and one in Boston, for an aggregate purchase price of approximately $507.3 million at a weighted average Acquisition Capitalization Rate of 4.4%. Also during the quarter, the Company sold a 506-unit apartment property located in New York City for approximately $416.1 million at a Disposition Yield of 3.9%, generating an Unlevered IRR of 9.8%. Further, on October 1, 2018, the Company prepaid a $500.0 million 5.19% mortgage loan with a maturity date of October 1, 2019 at par using funds from the Company’s revolving line of credit.
EQR in the third quarter of FY 18 has reported the adjusted earnings per share of 58 cents, beating the analysts’ estimates for the adjusted earnings per share of 32 cents. The company had reported the adjusted revenue growth of 2.3 percent to $652.68 million in the third quarter of FY 18, beating the analysts’ estimates for revenue of $644.86 million. The company has posted the Funds from operations of $0.83 per share, which is in line with the Zacks Consensus Estimate
During the third quarter of 2018, the Company produced Physical Occupancy of 96.2%, new lease rate growth of 1.2% and renewal rate growth of 5.1%. The Company also produced the lowest third quarter same store turnover in its history.
The Company re-entered the Denver market with its purchase of two recently completed apartment properties, totaling 726 apartment units, in the Uptown neighborhood for an aggregate purchase price of approximately $275.2 million.
During the third quarter of 2018, the Company completed the stabilization of two of its new development properties: 855 Brannan in San Francisco and Helios in Seattle.
The Company was recognized for the fifth consecutive year for leadership in Environmental, Social and Governance (ESG) by the Global Real Estate Sustainability Benchmark (GRESB).
For the fourth quarter of 2018, the company expects to be in the range of $0.32 to $0.34. The Company has established an FFO guidance range of $0.84 to $0.86 per share for the fourth quarter of 2018.
For FY 18, the company expects EPS to be in the range of $1.78 to $1.80 versus the consensus of $1.47.