Equity Residential Q2 EPS falls on lower property sale gains

Overview

• U.S. apartment REIT's Q2 EPS fell 40% yr/yr, mainly on lower property sale gains

• Normalized FFO per share rose 3% yr/yr, helped by higher same store NOI

• Company raised full-year same store revenue and NOI guidance, citing strong occupancy and renewals

Outlook

• Equity Residential raises full-year 2026 same store revenue growth guidance to 2.1%-2.7%

• Company lifts full-year 2026 same store NOI growth guidance to 1.5%-2.1%

• Equity Residential withdraws full-year 2026 EPS and FFO per share guidance due to pending merger

Result Drivers

• OCCUPANCY AND RENEWALS - Same store revenue growth was driven by strong physical occupancy and better than anticipated renewal rates

• SAN FRANCISCO MOMENTUM - Company cited strong momentum in the San Francisco market and improvements in bad debt across the portfolio as key drivers for raising guidance

• HIGH RESIDENT RETENTION - High occupancy and resident retention at historically high levels supported operating performance, per CEO Mark J. Parrell

Company press release: ID:nBw5sRwFxa

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 7 "strong buy" or "buy", 15 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the residential reits peer group is "buy"

• Wall Street's median 12-month price target for Equity Residential is $71.50, about 4.7% above its July 21 closing price of $68.29

• The stock recently traded at 46 times the next 12-month earnings vs. a P/E of 41 three months ago

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)