Analyst John Kim from BMO Capital maintained a Sell rating on JBG Smith Properties (JBGS – Research Report) and decreased the price target to $14.00 from $15.00.
John Kim has given his Sell rating due to a combination of factors impacting JBG Smith Properties. The company is facing a challenging economic environment, particularly in the DC metro area, with an anticipated slowdown and changes in the federal landscape affecting office utilization. This has led to a significant increase in the company’s FAD payout ratio, which has escalated to 169.4% from 112.5% the previous year, raising concerns about the sustainability of its dividend payouts.
Despite some positive aspects, such as strong performance in the multifamily sector with increased occupancy and NOI growth, the overall financial health of JBGS is under pressure. The company’s core FFO per share missed consensus expectations, and its office portfolio is experiencing declining occupancy rates. These factors combined suggest potential financial instability, prompting John Kim to issue a Sell rating for the stock.
Kim covers the Real Estate sector, focusing on stocks such as Eastgroup Properties, Vornado Realty, and Easterly Government Properties. According to TipRanks, Kim has an average return of 0.0% and a 46.41% success rate on recommended stocks.