Most REITs are seeing improving trends — including occupancy gains in seniors housing, apartments, and lodging and pricing power strengthening in apartments, single family home rentals, industrial and storage, writes Evercore ISI analyst Steve Sakwa, in summing up meetings the firm hosted at the NAREIT conference last week.
As a result, Sakwa changed some ratings on REITs he covers.
Upgrades Welltower (NYSE:WELL) to Outperform from In Line on improving senior housing operations, its acquisition outlook, and its potential for long-term margin expansion; lifts price target to $86 from $77.
WELL stock rises 0.4% in premarket trading.
Upgrades lodging REIT Pebblebrook Hotel Trust (NYSE:PEB) to In Line from Underperform "as we expect a pull forward of demand and a faster recovery in EBITDA growth and hence our fair value estimate has gone up."
Downgrades apartment REITs Equity Residential (NYSE:EQR), AvalonBay Communities (NYSE:AVB), and Camden Property Trust (NYSE:CPT) to In Line from Outperform, "not because we don't like the businesses, but based on the fact that the stocks have surged recently and we see less upside near-term from a total return perspective.