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On Tuesday, BTIG analysts held firm on their Buy rating for Hudson Pacific Properties (NYSE:HPP) with a consistent price target of $10.00. According to InvestingPro data, the stock currently trades at $3.03, suggesting significant upside potential. Analysis indicates the stock is currently undervalued compared to its Fair Value. The analysts highlighted the real estate investment trust’s (REIT) resilience amidst recent market turbulence, noting that while the sector experienced a 2.3% decline in March, it fared better than the S&P 500’s 4.7% drop and the Russell 2000’s 4.4% fall. Hudson (NYSE:HUD) Pacific, in particular, faced challenges due to its leverage and reliance on smaller tenants, leading to a 7.6% decrease in its stock value.
Despite the volatility and recessionary concerns impacting Hudson Pacific’s stock, BTIG analysts remain confident in the company’s strategic plan to stabilize its balance sheet. InvestingPro data reveals the company maintains a healthy current ratio of 1.55, indicating sufficient liquidity to meet short-term obligations. The company also offers a substantial 6.6% dividend yield, having maintained dividend payments for 15 consecutive years. This move is anticipated to pave the way for an improvement in office occupancy rates throughout the latter half of 2025. The analysts’ conviction was supported by Hudson Pacific’s fourth-quarter 2024 performance, which included 261k square feet in vacancy leasing, surpassing the 250k square feet threshold.
The company also provided dual guidance for the first quarter of 2025 earnings and full-year expenses, although it stopped short of announcing new asset sales. The upper limit of the targeted sales range was raised by approximately $25 million due to stronger pricing, and the company expressed optimism about securing imminent financing from multiple options.
BTIG analysts are focusing on three key catalysts for Hudson Pacific in 2025: achieving balance sheet stability, reaching the trough in office occupancy expected in the second quarter, and an uptick in studio activity in Los Angeles towards the end of the year, likely spurred by increased film and TV tax credits. The company generated $834.77M in revenue last year, with an EBITDA of $263.34M. For deeper insights into HPP’s financial health and growth potential, investors can access the comprehensive Pro Research Report available exclusively on InvestingPro, covering over 1,400 US stocks. The company’s path to earnings recovery is projected to be gradual, with a forecasted increase in funds from operations (FFO) per share for 2025 and new estimates introduced for 2026 and 2027. The reaffirmed Buy rating and $10 price target reflect BTIG’s positive outlook on Hudson Pacific’s near-term progress and long-term potential.
In other recent news, Hudson Pacific Properties reported several key developments impacting its operations and financial outlook. The company has recently finalized the sale of a non-core office property in the Los Angeles Arts District for $46 million, using the proceeds to reduce its unsecured revolving credit facility. This transaction is part of Hudson Pacific’s ongoing strategy to divest non-essential assets, which has totaled $93.8 million in sales since mid-November of the previous year. In addition, Jefferies initiated coverage on Hudson Pacific with a Hold rating, setting a price target of $2.70, citing concerns about the West Coast office market and the company’s studio business. Meanwhile, BTIG adjusted its price target for Hudson Pacific to $10, maintaining a Buy rating despite downward revisions in earnings expectations due to factors like wildfires and increased interest expenses. The firm anticipates an office occupancy inflection and a potential recovery in commercial real estate values in 2025. Moreover, Hudson Pacific confirmed that its Los Angeles properties remain operational following a recent unspecified event, with no damage reported to its office and studio facilities. The company plans to provide further updates during its upcoming fourth-quarter earnings call.
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