Home BusinessMarket Wedbush Initiates Coverage of Alexandria Real Estate Equities (ARE) with Outperform Recommendation

Wedbush Initiates Coverage of Alexandria Real Estate Equities (ARE) with Outperform Recommendation

by Kianna Warburton

Wedbush Initiates Coverage of Alexandria Real Estate Equities with Outperform Recommendation

According to Fintel reports, on October 3, 2023, Wedbush initiated coverage of Alexandria Real Estate Equities (NYSE:ARE) with an Outperform recommendation. This comes as positive news for investors interested in the company.

The analyst price forecast suggests a 66.50% upside for Alexandria Real Estate Equities. As of August 31, 2023, the average one-year price target for the company is 161.84. The forecasts range from a low of 138.37 to a high of $195.30. This represents a significant increase from its latest reported closing price of 97.20.

Investors can check the leaderboard of companies with the largest price target upside on Fintel’s website.

In terms of financials, the projected annual revenue for Alexandria Real Estate Equities is 2,316MM, which indicates a decrease of 15.64%. The projected annual non-GAAP EPS is 2.69.

Additionally, Alexandria Real Estate Equities recently declared a regular quarterly dividend of $1.24 per share, or $4.96 annualized. Shareholders of record as of September 29, 2023, will receive the payment on October 13, 2023. The current dividend yield, based on the stock’s share price of $97.20, is 5.10%.

Looking at the dividend history of the company, the average dividend yield over the past five years has been 2.86%. The lowest yield was 2.09%, and the highest was 5.05%. The standard deviation of yields is 0.56, based on a sample of 236 data points.

It is worth noting that the current dividend yield is 3.98 standard deviations above the historical average, indicating a potential outlier.

The company’s dividend payout ratio is 1.51, which means 100% of its income is paid out in dividends. While a high payout ratio may suggest a healthy dividend policy for companies with limited growth prospects, it can also indicate that the company is dipping into savings to sustain its dividends, which is not ideal. Companies with good growth prospects usually retain some earnings to invest in future growth, resulting in a payout ratio between 0 and 0.5.

In terms of fund sentiment, 1310 funds or institutions are reporting positions in Alexandria Real Estate Equities. This represents a decrease of 103 owners or 7.29% in the last quarter. The average portfolio weight of all funds dedicated to ARE is 0.40%, a decrease of 10.64%. Total shares owned by institutions decreased by 0.29% in the last three months to 171,670K shares.

The put/call ratio of ARE is 1.03, indicating a bearish outlook for the stock.

In terms of major shareholders, APG Asset Management US holds 7,250K shares, representing 4.19% ownership of the company. Vanguard Real Estate Index Fund Investor Shares holds 6,926K shares, representing 4.00% ownership, while Principal Financial Group holds 6,418K shares, representing 3.71% ownership. Jpmorgan Chase holds 5,648K shares, representing 3.26% ownership.

Alexandria Real Estate Equities, Inc. is an S&P 500® urban office real estate investment trust. It specializes in collaborative life science, technology, and agtech campuses in AAA innovation cluster locations. The company was founded in 1994 and has established a significant market presence in key locations such as Greater Boston, San Francisco, New York City, San Diego, Seattle, Maryland, and Research Triangle.

In conclusion, Wedbush’s initiation of coverage with an Outperform recommendation for Alexandria Real Estate Equities is positive news for investors. The projected upside and dividend yield offer potential returns, and the company’s market presence in key locations adds to its appeal. However, investors should carefully consider the associated risks and undertake thorough research before making any investment decisions.

Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect those of Nasdaq, Inc.

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