Easterly Government Properties Inc reports results for the quarter ended September 30 - Earnings Summary

What happened

Easterly Government Properties Inc reported quarterly adjusted earnings of 11 cents per share, above the 6 cents analysts expected and 2 cents a year earlier. Revenue rose 8.7% to $93.61 million, beating the $92.17 million estimate, with net income of $5.5 million.

Confirmed

Global impact / market context

Higher earnings and revenue than analysts expected suggest the company's rental income from government-leased buildings is holding up and costs are controlled, which supports the cash available to pay dividends, a key reason investors hold real estate investment trusts.

Analyst inference

The average analyst rating is hold, with two buy, four hold and one sell, and the $26.00 median price target sits 12.8% above the $22.67 last close. That gap suggests analysts see limited upside from here.

Analyst inference

What to watch

1. Analyst earnings estimates fell about 0.1% over three months, with no revisions in the last 30 days, so expectations are stable going into the next report. Confirmed
2. Watch whether the company's government tenants renew leases or expand space, since lease decisions drive rental revenue and the occupancy of its buildings. Proposed
3. Watch interest costs on borrowed money, because higher rates would reduce cash available for dividends and could pressure the shares toward the sell-rated side of coverage. Analyst inference

Evidence

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