Equity Residential Q3 FFO Meets Estimates, Rental Income Rises Y/Y

Equity Residential EQR reported third-quarter 2025 normalized funds from operations (FFO) per share of $1.02, which met the Zacks Consensus Estimate. The figure improved 4.1% from the year-ago quarter.Results reflect a rise in same-store revenues and physical occupancy on a year-over-year basis. The company revised its guidance for 2025 normalized FFO per share.Rental income of $782.4 million outpaced the consensus mark of $781.4 million. Rental income was up 4.6% year over year.According to Mark J. Parrell, Equity Residential’s president and CEO, “We continue to see a favorable outlook for our business given the low levels of housing supply expected to be Table of Contents 2 delivered over the next several years, particularly in our Coastal markets, powerful cost and social dynamics favoring rentership and a customer base that remains well employed with rising incomes.”EQR’s Q3 in DetailSame-store revenues were up 3% year over year, above our estimate of 1.9%. Same-store expenses flared up 3.6% year over year versus our estimate of 2.2%. Consequently, same-store net operating income (NOI) climbed 2.8% year over year, above our estimate of 1.7%.The average rental rate increased 2.7% year over year to $3,218 in the quarter ended in September. Meanwhile, the same-store portfolio physical occupancy improved by 20 basis points (bps) year over year at 96.3%. Our estimate for the metric was 96.4%.Same-store residential revenues were up 3% year over year, while expenses increased 3.4%. Same-store residential NOI expanded 2.7% year over year.The new lease change for its residential same-store properties was down 1.0%, while the renewal rate achieved by EQR was 4.5% for the third quarter. The blended rate for the quarter was 2.2%. The physical occupancy for this portfolio was 96.3%, improved 30 bps sequentially.EQR’s Portfolio ActivityIn the third quarter of 2025, Equity Residential acquired a 375-unit property located in Arlington, TX, for nearly $103 million. Moreover, the company sold two properties, one in suburban Boston and one in Arlington, VA, for an aggregate sale price of around $247.9 million.EQR’s Balance SheetEquity Residential exited the third quarter of 2025 with cash and cash equivalents of $93.1 million, up from $31.3 million recorded as of June 30, 2025.The net debt to normalized EBITDAre was 4.41X, which decreased from 4.45X in the previous quarter. The unencumbered NOI as a percentage of the total NOI was 90.4% in the quarter, remaining unchanged from the prior quarter.EQR Revises 2025 GuidanceFor the fourth quarter of 2025, the company projects normalized FFO per share in the band of $1.02 to $1.06. The Zacks Consensus Estimate is currently pegged at $1.04.For 2025, Equity Residential revised its normalized FFO per share in the band of $3.98-$4.02, compared to the $3.97-$4.03 range guided earlier. The Zacks Consensus Estimate is currently pegged at $4.00.The company’s full-year guidance incorporates projections for same-store revenue growth of 2.5-3.0%, an expense increase of 3.5-4.0%, and an NOI expansion of 2.1-2.6%. Physical occupancy is expected at 96.4%.EQR’s Zacks RankEquity Residential currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Equity Residential Price, Consensus and EPS Surprise Equity Residential price-consensus-eps-surprise-chart | Equity Residential Quote Upcoming Earnings ReleasesWe now look forward to the earnings releases of residential REITs like American Homes 4 Rent AMH and Centerspace CSR, slated to report on Oct. 29 and Nov. 3, respectively.The Zacks Consensus Estimate for American Homes 4 Rent’s third-quarter 2025 FFO per share stands at 46 cents, which indicates 4.6% growth year over year. AMH currently has a Zacks Rank #3.The Zacks Consensus Estimate for Centerspace’s third-quarter 2025 FFO per share is pegged at $1.22, which implies a 3.4% year-over-year increase. CSR currently carries a Zacks Rank #3.Note: Anything related to earnings presented in this write-up represent funds from operations (FFO), a widely used metric to gauge the performance of REITs.#1 Semiconductor Stock to Buy (Not NVDA)The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow.One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Equity Residential (EQR): Free Stock Analysis Report American Homes 4 Rent (AMH): Free Stock Analysis Report Centerspace (CSR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks