Highlands Ranch, Colorado-based UDR, Inc. (UDR) is a leading multifamily REIT with a demonstrated performance history of delivering superior and dependable returns by successfully managing, buying, selling, developing, and redeveloping attractive real estate communities in targeted U.S. markets. Valued at $13.7 billion by market cap, the company owns, operates, and develops apartment communities.
Shares of this leading multifamily REIT have underperformed the broader market considerably over the past year. UDR has gained 4.7% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 19.7%. In 2024, UDR’s stock rose 8.5%, compared to the SPX’s 12.1% rise on a YTD basis.
Narrowing the focus, UDR has also lagged behind the Residential REIT ETF (HAUS). The exchange-traded fund has gained about 18.3% over the past year. Moreover, the ETF’s 13.8% gains on a YTD basis outshine the stock’s single-digit returns over the same time frame.
On Jul. 30, UDR shares closed down marginally after reporting its Q2 results. Its adjusted funds from operations of $0.62 surpassed Wall Street's estimate of $0.61. Similarly, its adjusted revenue came in at $413.3 million, exceeding Wall Street's forecast of $412.9 million. For Q3, UDR expects its adjusted funds from operations to be between $0.61 and $0.63 and net income per share between $0.08 and $0.10.
The company raised its full-year adjusted funds from operations and expects it to be between $2.42 and $2.50, and net income per share between $0.35 and $0.43.
For the current fiscal year, ending in December, analysts expect UDR’s funds from operations to decline marginally to $2.45 on a diluted basis. The company’s surprise history is impressive. It beat or matched the consensus estimate in each of the last four quarters.
Among the 22 analysts covering UDR stock, the consensus is a “Moderate Buy.” That’s based on nine “Strong Buy” ratings and 13 “Holds.”
This configuration is more bullish than a month ago, with eight analysts suggesting a “Strong Buy.”
On Jul. 31, RBC Capital analyst Brad Heffern maintained a “Hold” rating on UDR with a price target of $40.
The mean price target of $42.12 represents a 1.3% premium to UDR’s current price levels. The Street-high price target of $49 suggests an upside potential of 17.9%.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
