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Realty Income Posts a Mixed Q2

By Eric Volkman – Aug 4, 2020 at 9:22PM

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Nevertheless, the popular REIT managed to grow headline fundamentals in the midst of the coronavirus pandemic.

Realty Income (O -0.41%), one of the sturdier retail real estate investment trusts (REITs) on the market, reported its Q2 of fiscal 2020 results after trading hours on Monday.

The period saw the REIT book revenue of $414.6 million, which was 13% higher than in the same quarter a year ago. Net income also saw a 13% rise, landing at $107.8 million for the quarter. The company's adjusted funds from operations (AFFO) -- considered the most accurate measure of profitability for REITs, as it excludes items such as depreciation -- increased more steeply, advancing 16% to $295.2 million, or $0.86 per share.

REIT spelled out in wooden blocks.

Image source: Getty Images.

While Realty Income easily topped the average analyst revenue estimate of just under $392 million, it fell short of those prognosticators' average $0.41 per share net profit projection.

That said, the REIT seems to be holding up quite well in the thick of the coronavirus pandemic. It said that its overall rent collection improved in June and July. All in all, it has received 91.5% of contractual rent from its tenants for July, while for the entirety of Q2 this figure was 86.5%.

As is typical for Realty Income, occupancy remains high; it stood at 98.5% at the end of the quarter, matching the end-Q1 level and slightly above the 98.3% of Q2 2019.

The company also continues to be a hungry acquirer of new properties. At quarter-end its portfolio held 6,541 properties in 49 states. It also had assets in Puerto Rico and the U.K. Roughly 600 tenants occupied those facilities. 

Realty Income did not provide revenue, profitability, or AFFO guidance. It did say it plans to spend a total of $1.25 billion to $1.75 billion this year on acquisitions.

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Stocks Mentioned

Realty Income Stock Quote
Realty Income
O
$62.81 (-0.41%) $0.26

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