Postal Realty Trust, Inc. (PSTL) reported mixed Q2 results, topping revenue estimates but missing earnings estimates by a cent.
Shares of the internally-managed real estate firm that owns and manages properties leased to the United States Postal Service have gained 29% over the past year.
Revenues jumped to $9.53 million versus $5.6 million a year ago and exceeded consensus estimates of $8.91 million. The increase in revenues reflected a surge in rental income, which increased to $9 million from $5.3 million in the prior-year quarter.
However, adjusted earnings of $0.04 per share fell a cent short of analysts’ expectations of $0.05 per share. The company reported a loss of $0.05 per share in the prior-year period.
For Q2, funds from operations (FFO) came in at $0.25 per share. The company said that it has acquired 71 postal properties for a total consideration of approximately $30 million. (See Postal Realty stock charts on TipRanks)
During the quarter, the company raised its dividend for the eighth consecutive quarter since its IPO in 2019 by 8.5% to $0.2225 per share.
CEO Andrew Spodek said, “We have continued to effectively execute on our growth plans having closed on 125 properties, including our expansion into Hawaii, bringing the Company’s owned and managed geographic reach to 50 states.
He also said, “We further strengthened our capital structure, entering into a new unsecured upsized revolving credit facility and term loan to support our future growth and enhance our flexibility and cost of capital. We are in a favorable position to accretively add additional industrial, flex and last mile USPS properties to grow our portfolio and cash flow.”
Following the Q2 results, BMO Capital analyst Frank Lee reiterated a Buy rating on the stock with a price target of $22 (11.5% upside potential).
Overall, the stock has a Moderate Buy consensus rating based on 2 Buys and 1 Hold. The average Postal Realty price target of $20.50 implies 3.9% upside potential from current levels.
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