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On Thursday, Piper Sandler reaffirmed its Overweight rating and $90.00 price target for SL Green Realty (NYSE:SLG). The firm’s analysis highlights SL Green’s exceptional performance in earnings revisions for 2025 compared to its peers in the office real estate sector. Despite a roughly 20% decline in SL Green’s stock value since its November equity offering, Piper Sandler’s analyst Alexander Goldfarb notes the company’s stronger valuation metrics relative to Vornado Realty Trust (NYSE:VNO), its direct New York City competitor. According to InvestingPro data, SLG has maintained dividend payments for 29 consecutive years, with a current dividend yield of 4.89%.
Goldfarb points out that SL Green leads the office real estate sector with positive earnings revisions for 2025, as depicted in Exhibit 1 of the report. This is in stark contrast to the widespread negative revisions seen among most office companies. The firm emphasizes that SL Green’s stock is trading at a more attractive implied 6.4% capitalization rate and 12 times 2025 estimated consensus earnings, compared to Boston Properties (NYSE:BXP), which is rated Overweight and trades at 6.9% and 11 times, and Vornado Realty Trust, which holds a Neutral rating and trades at 5.5% and 20 times. InvestingPro analysis suggests the stock is currently overvalued, with additional insights available in the comprehensive Pro Research Report, which covers over 1,400 US stocks.
The analysis suggests that SL Green’s history of positive news announcements, which are expected to continue, does not justify the current discount in its stock price when compared to Vornado. Goldfarb’s commentary underscores the company’s resilience and potential undervaluation in the market, especially given its recent performance and future earnings prospects. The company maintains strong liquidity with a current ratio of 9.36, though InvestingPro data indicates analysts anticipate a sales decline in the current year.
SL Green’s position as a top performer in earnings revisions, especially in the face of general negative sentiment in the office segment, is a focal point of Piper Sandler’s continued confidence in the company. The firm’s Overweight rating indicates an expectation that SL Green’s stock will outperform the average total return of the stocks in the analyst’s coverage universe over the next 12 to 18 months.
Investors in the real estate market will be watching closely to see if SL Green can maintain its lead in earnings revisions and if the stock’s valuation will adjust to reflect the company’s robust fundamentals as suggested by Piper Sandler’s analysis.
In other recent news, SL Green Realty Corp has been making significant strides in its business operations. The company reported an impressive fourth quarter with revenue standing at $245.9 million, marking a year-on-year increase of 16%. Funds From Operations (FFO) per share were also reported at $1.81, a significant increase from 72 cents per share in the same quarter of the previous year. These earnings and revenue results surpassed average analyst estimates.
SL Green also extended CEO Marc Holliday’s term until July 18, 2028, with an annual base salary of $1.4 million. His compensation package includes long-term incentive plan units valued at no less than $5 million annually.
In other developments, Truist Securities adjusted its stance on SL Green Realty Corp, increasing the company’s price target from $61.00 to $62.00 while maintaining a hold rating. This adjustment was influenced by the company’s stronger-than-anticipated quarterly performance. Additionally, JPMorgan notably raised its target for the company to $80 from $51. These are among the recent developments for SL Green Realty Corp.
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