Stock Analysis: VICI Properties - Forecasts and Evaluations by Analysts
In the ever-changing landscape of the stock market, VICI Properties Inc., an experiential real estate investment trust (REIT), has managed to stand out. Despite underperforming the broader market over the past 52 weeks, the company has still outperformed its sector and raised its AFFO guidance for fiscal 2025.
The strong operational performance, stable and growing rental income from long-term triple-net leases, and disciplined portfolio management are key factors contributing to VICI's resilience.
In Q2 of this year, VICI reported GAAP revenue of $1.0 billion, up 4.6% year-over-year, and AFFO per share increased by 5.3% to $0.60, demonstrating solid earnings growth that exceeded estimates. The company maintains nearly full occupancy, with tenants locked into long-term, triple-net leases that pay all property expenses. This model provides stable cash flows and protects VICI from inflation through built-in annual rent escalations.
Despite a challenging market, VICI’s low valuation and high dividend yield make it attractive relative to other income investments, especially as interest rates have started to decline in 2024. This has prompted some investors to return to high-yield dividend stocks like VICI.
VICI's focus on disciplined portfolio expansion and effective capital management supports growth in Adjusted Funds From Operations (AFFO) and dividends. Its assets’ exposure to gaming and hospitality – sectors that have shown resilience and favorable regulatory environments – further underpins its performance.
For the current fiscal year, ending in December, analysts expect VICI's FFO to grow 4.4% year over year to $2.36 per share. The mean price target of $36.55 represents an 11.1% premium from VICI's current price levels, while the Street-high price target of $44 suggests a notable upside potential of 33.7% for VICI Properties Inc.
Barry Jonas, an analyst from Truist Financial Corporation, maintains a "Buy" rating on VICI and set a price target of $38. The price target indicates a potential upside of 15.5% from the current levels.
It's important to note that as of the date of publication, Neharika Jain did not have positions in any of the securities mentioned in the article.
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- VICI Properties Inc.'s resilience in the stock market is partially attributed to its focus on finance, as demonstrated by their disciplined portfolio management and effective capital management.
- With a high dividend yield and promising growth in Adjusted Funds From Operations (AFFO) and dividends, VICI Properties Inc. presents an attractive investment opportunity in the realm of business and investing.
