Piper Sandler has adjusted its financial outlook on Boston Properties Inc. (NYSE: NYSE:BXP), increasing the real estate company's price target from $70.00 to $78.00, while maintaining a Neutral rating.
The firm's revised forecast is based on a detailed analysis of the company's future funds from operations (FFO).
The new price target reflects an uplift in the 2024 estimated FFO, which Piper Sandler now sets at $7.10, a slight increase from the company's revised guidance range of $7.07 to $7.13. Despite this adjustment for 2024, the firm has reduced its 2025 FFO estimate by $0.13, bringing it down to $7.08, and introduced a 2026 estimate of $7.22.
These projections take into account Boston Properties' second-quarter results of 2024 and the company's recent $850 million debt issuance at a 5.75% interest rate, aimed at repaying its first-quarter 2025 debt.
Piper Sandler's updated third-quarter 2024 FFO estimate for Boston Properties stands at $1.80, aligning with the lower end of the company's guidance range of $1.80 to $1.82. The firm also highlighted its mid-year practice of shifting focus to the following year's target FFO multiple, which is now approximately 11 times, compared to the roughly 10 times multiple of the 2024 estimate previously used.
In other recent news, Boston Properties saw an increase in leasing activity and an increase in funds from operations (FFO) per share guidance, following a strong second quarter.
The company completed over 1.3 million square feet of leasing, marking a 41% increase from the same period in the previous year.
Boston Properties' adjusted earnings per share (EPS) for the fourth fiscal quarter were reported at $0.13, surpassing expectations by $0.05, despite a 6.5% decline in revenue compared to the previous year.
Truist Securities has adjusted its financial outlook for the company, increasing the price target to $77 from $67 and maintaining a Hold rating on the stock. The firm has also raised its adjusted EBITDA estimate for the fiscal year 2025 to $163 million, up from the previous $156 million forecast.
In addition, Boston Properties has been recognized as one of the world's most sustainable companies by Time Magazine and is actively pursuing acquisitions and residential projects.
InvestingPro Insights
As Piper Sandler updates its financial outlook on Boston Properties Inc. (NYSE: BXP), investors may find additional insights from InvestingPro valuable. With a market capitalization of $13.32 billion and a recent trading pattern that has seen the company's stock price nearing its 52-week high, Boston Properties is a significant player in the Office REITs industry. Its stock performance has been strong over the last three months, with a price total return of 27.32%, and it has maintained dividend payments for 28 consecutive years, offering a current dividend yield of 5.21%.
InvestingPro data shows that Boston Properties is trading at a high earnings multiple, with a P/E ratio of 69.83, which is adjusted to 39.32 on a last twelve months basis as of Q2 2024. This valuation reflects the company's expected net income growth this year, as well as its prominent position in its industry. Analysts on InvestingPro predict that the company will be profitable this year, with profitability also demonstrated over the last twelve months.
For those considering a deeper dive into Boston Properties' financials and future prospects, InvestingPro provides additional tips. There are currently 9 additional InvestingPro Tips available that can offer further guidance on the company's financial health and investment potential. These tips, along with real-time metrics and analyst targets, can be accessed for Boston Properties at InvestingPro.
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