Intending to maximize shareholders’ wealth, Four Corners Property Trust FCPT is on board with multiple acquisitions. These moves will foster portfolio strength and yield incremental revenues over time.
In effect, FCPT recently announced shelling out $13.5 million to purchase two Riverview Health properties through sale-leaseback. These represent outpatient primary care units out of several such properties held by Hamilton County (Indiana), the owner of Riverview Health, a non-profit health curator.
The properties lie in the highly trafficked corridor in Indiana, secured under triple-net leases with a weighted average term of 12 years remaining. The transaction was executed at a capitalization rate of 7.3% on rent net of transaction costs.
At the same time, FCPT announced two additional acquisitions, that of a MercyOne outpatient clinic property in Iowa for $2.8 million and the other one being a P.F. Chang’s bistro property in Illinois for $4.8 million.
FCPT’s Past Acquisitions
Of late, this real estate investment trust (REIT), mainly engaged in the ownership and acquisition of high-quality, net-leased restaurant and retail properties, has been on an acquisition spree.
In mid-December, FCPT announced the buyout of a City Barbeque property for $2.6 million in a highly trafficked corridor in Georgia. The unit is a new development, corporate-operated with 11 years of term remaining. It also acquired a triple net leased, corporate-operated Panera Bread unit in Indiana for $2 million.Early in December, Four Corners announced the purchase of a corporate-operated, triple-net-leased NAPA Auto Parts property for $2.0 million in New York.
These strategic moves not only broaden FCPT's footprint in various states but also ensure portfolio diversification. Such efforts benefit the company and its investors as they gain exposure to growing industries and establish long-term lease agreements with strong tenants.
However, the company’s expansions may face potential headwinds in a still high-interest-rate environment, which could keep its borrowing costs elevated.
Over the past six months, shares of this Zacks Rank #4 (Sell) company have risen 9% compared with the industry's growth of 3.6%. However, analysts seem bearish on this stock, with the Zacks Consensus Estimate for its 2024 funds from operations (FFO) per share being lowered marginally over the past two months to $1.72.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks to consider from the broader REIT sector are Crown Castle Inc. CCI and Highwoods Properties HIW, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Crown Castle Inc.’s current-year FFO per share has moved northward marginally over the past two months to $6.99.
The Zacks Consensus Estimate for Highwoods Properties’ current-year FFO per share has been raised marginally over the past month to $3.62.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.
Research Chief Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.
Free: See Our Top Stock And 4 Runners UpHighwoods Properties, Inc. (HIW) : Free Stock Analysis Report
Crown Castle Inc. (CCI) : Free Stock Analysis Report
Four Corners Property Trust, Inc. (FCPT) : Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
