Invitation Homes Posts Better-Than-Expected 4Q Results As Rent, Occupancy Pick Up

Invitation Homes reported better-than-expected 4Q results driven by a rise in average monthly rent and occupancy.

The home leasing company’s 4Q earnings surged 20% to $0.12 per share on a year-over-year basis and beat the Street estimates of $0.06 per share. Revenues increased 4.5% to $464 million and surpassed the consensus mark of $460.61 million.

Invitation Homes’ (INVH) adjusted funds from operations (FFO) in the quarter were $0.27 per share, down from $0.28 recorded in the prior-year quarter. Same Store core revenue growth was 2% year-over-year. Average monthly rent increased 3.3%, while average occupancy surged 210 basis points to 98.1%.

Invitation Homes CEO Dallas Tanner commented, “The ever-changing environment of 2020 could not impede us from executing on strategic initiatives to drive growth and enhance the resident experience, and we are excited as we look into 2021 and beyond at strong fundamentals and an opportunity to raise the bar even higher.”

For 2021, the company projects adjusted FFO to be in a range of $1.09 to $1.19 per share. Same Store core revenue growth is anticipated to be in the range of 3.5% to 4.5%. (See Invitation Homes stock analysis on TipRanks)

On Feb. 16, Credit Suisse analyst Sam Choe initiated the coverage on the stock with a Buy rating and a price target of $33 (6.7% upside potential), citing “the company’s industry-leading scale and local market density.”

Choe sees “more potential upside coming from strategic operating initiatives.”

The consensus rating among analysts is a Strong Buy based on 7 Buys and 2 Holds. The average analyst price target stands at $33.71 and implies upside potential of about 9% to current levels. Shares have increased 9% over the past six months.

Additionally, Invitation Homes scores a 9 of 10 from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.

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