Earnings Review and Free Research Report: Agree Realty’s Quarterly Revenue Surged 29%; AFFO Soared 30.1%

Research Desk Line-up: CBRE Group Post Earnings Coverage

LONDON, UK / ACCESSWIRE / August 1, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Agree Realty Corp. (NYSE: ADC), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=ADC, following the Company’s disclosure of its second quarter fiscal 2017 earnings results on July 24, 2017. The real estate investment trust outperformed revenue forecasts and met Adjusted Funds from Operations (AFFO) expectations. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member’s account at:

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Get more of our free earnings reports coverage from other constituents of the Property Management industry. Pro-TD has currently selected CBRE Group, Inc. (NYSE: CBG) for due-diligence and potential coverage as the Company reported on July 27, 2017, its financial results for Q2 2017 which ended on June 30, 2017. Register for a free membership today, and be among the early birds that get access to our report on CBRE Group when we publish it.

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Earnings Reviewed

For Q2 2017, Agree Realty’s revenue came in at $28.08 million compared to revenue of $21.84 million in Q2 2017. The Company’s total rental revenue, which includes minimum rents and percentage rents, for the three months ended June 30, 2017, increased 26.3% to $25.2 million compared to total rental revenue of $19.9 million for Q2 2016. Agree Realty’s revenue number exceeded analysts’ expectations of $27.3 million.

Agree Realty’s net income attributable to the Company for Q2 2017 surged 39.5% to $14.9 million compared to $10.7 million for Q2 2016. The Company’s net income per share for the reported quarter gained 17.4% to $0.56 compared to $0.48 per share for the prior year’s same quarter.

During Q2 2017, Agree Realty’s Funds from Operations (FFO) rose 30.6% to $18.0 million compared to FFO of $13.8 million for Q2 2016. FFO per share for the reported quarter totaled $0.67 compared to FFO per share of $0.61 in the prior year’s corresponding quarter.

Agree Realty’s AFFO for Q2 2017 advanced 30.1% to $17.9 million compared to AFFO of $13.7 million in Q2 2016. The Company’s AFFO per share for the reported quarter totaled $0.67 compared to AFFO per share of $0.61 in the year ago same period. The Company’s AFFO numbers met Wall Street’s expectations of $0.67 per share.

Portfolio Update

As of June 30, 2017, Agree Realty’s portfolio consisted of 413 properties located in 43 states and totaled 7.9 million square feet of gross leasable space. Properties ground leased to tenants accounted for 6.9% of annualized base rents. The Company stated that the portfolio was approximately 99.6% leased, had a weighted average remaining lease term of approximately 10.6 years, and generated approximately 43.9% of annualized base rents from investment grade retail tenants.

Acquisitions

Agree Realty’s total acquisition volume for Q2 2017 was approximately $131.0 million and included 36 assets net leased to notable retailers operating in the discount apparel, convenience stores, auto parts, auto service, health and fitness, and home improvement sectors. For the six months ending June 30, 2017, the Company’s total acquisition volume was approximately $183.9 million and included 47 high-quality retail net lease assets.

Dispositions

During Q2 2017, Agree Realty sold two properties for gross proceeds of approximately $12.1 million. The dispositions were completed at a weighted-average capitalization rate of 6.0%. For H1 2017, the Company has divested three properties for total gross proceeds of $22.6 million. The weighted-average capitalization rate of the dispositions was 5.9%.

Development and Partner Capital Solutions

In Q2 2017, the Company completed its previously announced Camping World in Georgetown, Kentucky. The project was the Company’s first ground-up development for Camping World subject to a new 20-year net lease. Total project costs were approximately $8.2 million. Also within the reported quarter, the Company completed landlord’s work in Boynton Beach, Florida. The project is subject to a new 15-year net lease. Rent is anticipated to commence in Q3 2017 upon completion of the tenant’s work.

During Q2 2017, Agree Realty commenced three new development and Partner Capital Solutions (PCS) projects with total costs of approximately $24.1 million. The projects include the Company’s first PCS project with Art Van Furniture in Canton, Michigan, as well as the Company’s first two development projects with Mister Car Wash in Urbandale, Iowa and Bernalillo, New Mexico.

Leasing

In Q2 2017, Agree Realty executed new leases, extensions, or options on approximately 86,000 square feet of gross leasable area throughout the existing portfolio. Notable new leases, extensions, or options included a 33,608-square foot Big Lots in Cedar Park, Texas. The Company has one remaining lease maturity in 2017 representing 0.3% of annualized base rent.

Capital Markets

On June 16, 2017, Agree Realty announced that it has completed a follow-on public offering of 2,415,000 shares of common stock, which included the underwriters’ full exercise of their option to purchase additional shares. Total net proceeds were approximately $108.0 million after deducting the underwriting discount and offering expenses.

During the reported quarter, the Company issued 2,500 shares of common stock under its at-the-market equity program (“ATM program”), realizing gross proceeds of approximately $0.1 million.

Balance Sheet

As of June 30, 2017, Agree Realty’s net debt-to-recurring EBITDA was 4.6 times and its fixed charge coverage ratio was 4.0 times. The Company’s total debt to total enterprise value was 24.7%.

Agree Realty’s assets are held by, and its operations are conducted through, Agree Limited Partnership, of which the Company is the sole general partner. As of June 30, 2017, there were 347,619 operating partnership units outstanding and the Company held a 98.8% interest in the operating partnership.

Outlook

For FY17, Agree Realty is forecasting acquisition volume between $250 million and $275 million of high-quality retail net lease properties. The Company’s disposition guidance remains in the range of $30 million and $50 million for 2017.

Stock Performance

On Monday, July 31, 2017, the stock closed the trading session flat at $49.17. A total volume of 148.47 thousand shares have exchanged hands. Agree Realty’s stock price advanced 6.66% in the last one month, 1.51% in the past three months, and 6.13% in the previous six months. Furthermore, since the start of the year, shares of the Company have gained 6.78%. The stock is trading at a PE ratio of 22.07 and has a dividend yield of 4.11%. The stock currently has a market cap of $1.40 billion.

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