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Kimco Realty's Rating Outlook Upgraded to Positive by S&P Global
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Kimco Realty (KIM - Free Report) recently announced that the retail real estate investment trust (REIT) secured a rating outlook upgrade to ‘Positive’ from ‘Stable’ by S&P Global Ratings, with the company’s issuer credit rating reaffirmed at BBB+.
Steady improvement in Kimco's diversified real estate portfolio quality, accompanied by leverage reduction, drove the upward revision in the rating outlook by the rating agency.
The positive outlook is backed by the rating agency's expectation that KIM will continue to ride on the growth curve, given its value-accretive portfolio diversification through active mergers and acquisitions with Weingarten in 2021 and RPT in 2024, respectively. The favorable retail demographics aiding in strong leasing activities and persistent higher occupancy levels have raised the average base rents and are likely to result in improving operating performance over the next two years.
The S&P rating outlook upgrade marks its solid creditworthiness and will render it favorable access to the debt market. Recently, KIM also secured an ‘A-’ credit rating with a stable outlook from Fitch Ratings. This achievement positions the company among only 12 publicly listed U.S. REITs that hold a credit rating of ‘A-’ or higher.
Shares of this Zacks Rank #3 (Hold) company have rallied 27.6% in the past three months, outperforming the industry's growth of 15.1%.
Image Source: Zacks Investment Research
Kimco is well-poised to benefit from its portfolio of high-quality, open-air shopping centers, which are predominantly grocery-anchored, in the drivable first-ring suburbs within key major metropolitan Sunbelt and coastal markets. Its focus on developing mixed-use assets bodes well for long-term growth.
Kimco maintains a healthy balance sheet position. It exited the second quarter of 2024 with $1.9 billion of immediate liquidity. Its consolidated weighted average debt maturity profile is 8.7 years. With a healthy financial footing, KIM is well-positioned to capitalize on long-term growth opportunities.
The Zacks Consensus Estimate for Brixmor’s 2024 FFO per share is pegged at $2.13, suggesting year-over-year growth of 4.4%.
The Zacks Consensus Estimate for Tanger’s 2024 FFO per share stands at $2.09, indicating an increase of 6.6% from the year-ago reported figure.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.
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Kimco Realty (KIM - Free Report) recently announced that the retail real estate investment trust (REIT) secured a rating outlook upgrade to ‘Positive’ from ‘Stable’ by S&P Global Ratings, with the company’s issuer credit rating reaffirmed at BBB+.
Steady improvement in Kimco's diversified real estate portfolio quality, accompanied by leverage reduction, drove the upward revision in the rating outlook by the rating agency.
The positive outlook is backed by the rating agency's expectation that KIM will continue to ride on the growth curve, given its value-accretive portfolio diversification through active mergers and acquisitions with Weingarten in 2021 and RPT in 2024, respectively. The favorable retail demographics aiding in strong leasing activities and persistent higher occupancy levels have raised the average base rents and are likely to result in improving operating performance over the next two years.
The S&P rating outlook upgrade marks its solid creditworthiness and will render it favorable access to the debt market. Recently, KIM also secured an ‘A-’ credit rating with a stable outlook from Fitch Ratings. This achievement positions the company among only 12 publicly listed U.S. REITs that hold a credit rating of ‘A-’ or higher.
Shares of this Zacks Rank #3 (Hold) company have rallied 27.6% in the past three months, outperforming the industry's growth of 15.1%.
Image Source: Zacks Investment Research
Kimco is well-poised to benefit from its portfolio of high-quality, open-air shopping centers, which are predominantly grocery-anchored, in the drivable first-ring suburbs within key major metropolitan Sunbelt and coastal markets. Its focus on developing mixed-use assets bodes well for long-term growth.
Kimco maintains a healthy balance sheet position. It exited the second quarter of 2024 with $1.9 billion of immediate liquidity. Its consolidated weighted average debt maturity profile is 8.7 years. With a healthy financial footing, KIM is well-positioned to capitalize on long-term growth opportunities.
Stocks to Consider
Some better-ranked stocks from the retail REIT sector are Brixmor Property Group (BRX - Free Report) and Tanger, Inc. (SKT - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Brixmor’s 2024 FFO per share is pegged at $2.13, suggesting year-over-year growth of 4.4%.
The Zacks Consensus Estimate for Tanger’s 2024 FFO per share stands at $2.09, indicating an increase of 6.6% from the year-ago reported figure.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.