Piper Sandler maintains Overweight rating on Boston Properties stock

Published 07/04/2025, 17:06
Piper Sandler maintains Overweight rating on Boston Properties stock

On Monday, Piper Sandler reiterated its Overweight rating on Boston Properties Inc. (NYSE: NYSE:BXP), with a steady price target of $100.00. The research firm's analyst, Alexander Goldfarb, highlighted the real estate company's valuation and market positioning, which he believes are not fully appreciated by the market. According to InvestingPro data, the stock has recently fallen into oversold territory, with a significant 10% decline over the past week, suggesting potential buying opportunities for value investors.

Boston Properties' main markets are expected to remain stable or improve, with the analyst noting that there are below-average lease expirations set for 2026 and 2027. These markets include strategic locations such as Boston's Back Bay, Midtown in New York City, Washington D.C., and the Reston Town Center, along with increasing activity in San Francisco and Seattle. The company's strong market presence is reflected in its impressive financial metrics, including a healthy gross profit margin of 61% and steady revenue growth of 4.45% over the last twelve months.

The analyst pointed out that Boston Properties shows favorable comparisons with its Coastal office peers across several financial metrics. The company's Funds from Operations (FFO) multiple, dividend yield, and leverage were all mentioned as reasons for the attractive valuation of the stock. InvestingPro analysis reveals the company has maintained dividend payments for 29 consecutive years, currently offering a substantial 6.49% yield. For deeper insights into BXP's valuation and peer comparison, investors can access comprehensive Pro Research Reports, available exclusively on InvestingPro.

Goldfarb based the $100 price target on approximately 15 times the firm's estimated 2025 FFO. However, he also cautioned investors about potential risks that could impact the company's performance. These risks include regulatory changes, tax implications, quality of life factors, economic trends, office demand fluctuations, and interest rate variations.

Boston Properties Inc. is known for its portfolio of high-quality office properties located in key markets across the United States. The firm's focus on these prime locations is part of its strategic approach to real estate investment and management. With a market capitalization of $9.37 billion and an EBITDA of $1.9 billion over the last twelve months, BXP maintains its position as a prominent player in the Office REITs industry. Additional financial metrics and industry analysis are available through InvestingPro's extensive database of over 1,400 detailed company reports.

In other recent news, Boston Properties (BXP) reported a significant shortfall in its fourth-quarter earnings for 2024, with an earnings per share (EPS) of -$1.45, falling well below the expected $0.48. Despite this, the company's revenue exceeded forecasts, reaching $858.6 million against the anticipated $836.85 million. Jefferies initiated coverage on Boston Properties with a Buy rating and a price target of $78, citing potential occupancy gains due to a stable lease expiration profile through 2027. KeyBanc maintained a Sector Weight rating, noting expected occupancy declines in early 2025, but a potential recovery in the latter half of the year. Furthermore, BXP enhanced its financial flexibility by extending its credit facilities and commercial paper program, increasing its unsecured revolving credit facility to $2.25 billion. Additionally, BXP announced a joint venture for a new residential project in Jersey City, New Jersey, contributing $65 million in preferred equity to the development. These developments reflect Boston Properties' ongoing strategic efforts to navigate the evolving real estate market.

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