On Friday, RBC Capital Markets adjusted its outlook on W. P. Carey & Co. (NYSE:WPC), a global net-lease REIT, reducing the price target to $63 from the previous $65 while continuing to recommend the stock as Outperform. The adjustment follows the company's first-quarter 2024 performance, which did not meet expectations primarily due to the timing of lease-related income and corporate expenses.
The company's acquisition pace is perceived to be slower than planned, although W. P. Carey's management remains confident in meeting their guidance. RBC Capital notes that several credit issues previously identified have been addressed or are nearing resolution. However, the firm has added Hearthside to its watch list this quarter, which appears to be a conservative move.
W. P. Carey's Adjusted Funds From Operations (AFFO) per share estimates have been slightly revised downward by RBC Capital. The firm is currently projecting AFFO per share at the lower end of the company's guidance, anticipating an increase in acquisition activity.
The reduction in the price target to $63 reflects a more cautious valuation by RBC Capital, factoring in the recent quarter's performance and near-term expectations. Despite this, the firm's Outperform rating indicates a continued positive outlook on the stock's potential performance relative to the market.
InvestingPro Insights
In light of RBC Capital Markets' recent outlook adjustment for W. P. Carey & Co., current real-time data from InvestingPro provides additional context for investors. The company boasts an impressive gross profit margin of 92.06% over the last twelve months as of Q1 2024, highlighting their strong operational efficiency. Additionally, W. P. Carey has a track record of consistent shareholder returns, having maintained dividend payments for 27 consecutive years, with a current dividend yield of 6.19%.
InvestingPro Tips also reveal that W. P. Carey's liquid assets exceed its short-term obligations, indicating a healthy liquidity position. Moreover, analysts predict the company will remain profitable this year, which aligns with the positive sentiment from RBC Capital's Outperform rating. For investors seeking a deeper analysis, InvestingPro offers additional tips, including insights into W. P. Carey's market cap, currently standing at $12.24B USD, and a P/E ratio of 20.83, reflecting investor sentiment about the company's earnings potential.
For those interested in a comprehensive investment analysis, InvestingPro provides 5 more InvestingPro Tips on W. P. Carey. To explore these insights and optimize your investment strategy, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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