Q: Please comment on recent earnings. You have been positive on this company in the past. What would be a reasonable entry point assuming you still like it and what would be your growth expectations going forward. Thanks.
5i Research Answer:
EPS of $12.18 beat estimates of $2.4 and sales of $66.9M missed estimates of $69.27M. It raised its dividend by 45% to $0.04 per share, and net operating income rose 24% in the quarter. Rental revenue from operations rose 20%, and the vacancy rate fell to 3.4% from 4.3% last year. While the results were strong, and growth remains at high levels, there was an analyst downgrade due to its lofty valuations (24X forward earnings). Its valuation has mostly remained flat over the past couple of years, but the company has executed well on growth and profitability. Given its continued execution, we would be comfortable with an entry point around $195 to $200.