REIT stock to watch: Apartment Investment and Management Co (NYSE: AIV)

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Apartment Investment and Management Co (NYSE: AIV) stock lost over 0.71% on 1st November, 2019 (As of  1:46 pm GMT-4; Source: Google finance) post third quarter of FY 19 output. In July 2018, AIV had sold its Asset Management business, accepting its near-term earnings dilution, therefore the year-over-year, third quarter net income decreased mainly due to lower gains from dispositions. In redevelopment, the company has invested $71 million at properties throughout the portfolio.

Moreover, in the third quarter of 2019, the company has lowered its annual cost of leverage by about 10 basis points and extended the term of its balance sheet. Further, the company has financed $668 million worth of property debt at a weighted-average interest rate of 3.34% and a weighted-average maturity of 11.4 years. The company has also rate-locked a property loan for $100 million at a 3.21% interest rate and an eleven-year term to maturity.

AIV in the third quarter of FY 19 has reported the adjusted funds from operations per share of 64 cents, beating the analysts’ estimates for the adjusted funds from operations per share of 63 cents. Aimco’s third quarter AFFO per share was flat year-over-year on the back of the $0.01 increase in Pro forma FFO per share, which was offset by a $0.01 increase in capital replacement spending. The company had reported the adjusted revenue of $229.8 million in the third quarter of FY 19, beating the analysts’ estimates for revenue of $227.2 billion. In the third quarter, the company reported 3.8% increase in the Same Store revenue year-over-year and NOI was up 4.1%.

For the fourth quarter ending in December, Apartment Investment Management expects its per-share funds from operations to be in the range from 62 cents to 66 cents.

The company expects full-year funds from operations to be in the range of $2.47 to $2.51 per share. For the full year 2019, Aimco expects total capital replacement expenditures, per share, to be flat year-over-year as the company is upgrading its portfolio and investing capital in fewer, but more valuable, properties.

Meanwhile, at Parc Mosaic, the company had delivered the first building in August and, as of September 30, AIV had leased 91% of its apartment homes. In late October, the company had completed the construction of the second building and had leased more than half of its apartment homes. The remaining buildings are on schedule to be delivered by year end.

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