Financial Data and Key Metrics Changes - The company reported net income attributable to common shareholders of $99.7 million, or $0.27 per diluted share, with core FFO per share growth of 6.2% year-over-year [11][12] - The updated guidance for core FFO per share was increased by $0.01 to $1.87 at the midpoint, representing a growth of 5.6% for the last stretch of 2025 [6][14] - Same home core revenue growth was reported at 3.8%, with same home core operating expense growth muted at 2.4%, leading to same home core NOI growth of 4.6% [7][14] Business Line Data and Key Metrics Changes - The AMH development program delivered a total of 651 homes to wholly owned and joint venture portfolios, on track with expectations [12] - The company sold 395 properties, generating approximately $125 million of net proceeds at an average economic disposition yield in the high 3% [12][13] - Same home average occupied days were reported at 95.9%, with preliminary new lease spreads of 0.3% balanced by renewal rate growth of 4% [7][8] Market Data and Key Metrics Changes - The Midwest markets continue to outperform, supported by good underlying fundamentals, with expectations for sustained performance into 2026 [24][25] - The company noted that BTR and multifamily are off-peak deliveries, with expectations for improvement into 2026 [53] Company Strategy and Development Direction - The company focuses on portfolio optimization, operational execution, and prudent capital management, which has driven solid contributions from all areas of the AMH platform [5][6] - The strategy includes a shift in lease expiration management to front-load expirations in the first half of the year, which has positively impacted occupancy and new lease trends [20][22] - The company is leveraging AI tools to enhance operational efficiency and improve the leasing experience [46][47] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the momentum heading into 2026, with expectations for improved occupancy and rent growth in the spring leasing season [34][70] - The company remains proactive in addressing regulatory updates and has been engaging with local municipalities to communicate its contributions to housing supply [81][83] Other Important Information - The company achieved a fully unencumbered balance sheet, marking a significant milestone, with net debt to Adjusted EBITDA down to 5.1 times [13] - Full year 2025 property tax growth is expected to be in the high 2% area, positively impacting the updated full year outlook [12][14] Q&A Session Summary Question: Impact of lease expiration strategy on occupancy and new lease trends - Management noted that the shift in lease expiration strategy has led to a decrease in turnover rate and is expected to build occupancy towards the end of the year [20][22] Question: Sustained performance of Midwest markets - Management confirmed continued strength in the Midwest due to good quality of life and affordability, with expectations for positive contributions to the portfolio [24][25] Question: Deceleration in same store revenue growth - Management explained that the deceleration is influenced by timing of leasing spreads and strategic acceleration of leasing activity earlier in the year [28][30] Question: Fourth quarter trends and outlook for 2026 - Management indicated that November and December are expected to show positive effects on occupancy, positioning the company well for the next year [34][35] Question: Stock buybacks versus development funding - Management stated that stock buybacks are being monitored closely and could complement the value created by the development program at the right price [40][41] Question: Regulatory updates and election cycle - Management reported that regulatory activity has been quiet, with proactive engagement with local officials to highlight the company's contributions [81][83]

Financial Data and Key Metrics Changes - The company reported net income attributable to common shareholders of $99.7 million, or $0.27 per diluted share, with core FFO per share growth of 6.2% year over year [12][4] - The updated guidance for core FFO per share was increased by $0.01 to $1.87 at the midpoint, representing a growth of 5.6% for the last stretch of 2025 [4][15] - Same home core revenue growth was reported at 3.8%, with same home core NOI growth of 4.6% [5][15] Business Line Data and Key Metrics Changes - The company delivered solid same home average occupied days of 95.9% and new, renewal, and blended rental rate spreads of 2.5%, 4%, and 3.6% respectively [5][4] - Same home core operating expense growth was muted at 2.4%, contributing to the overall NOI growth [5][15] - The AMH development program delivered a total of 651 homes to the wholly owned and joint venture portfolios [13] Market Data and Key Metrics Changes - The Midwest markets continue to outperform, supported by good underlying fundamentals and a favorable cost of living [26][27] - The company noted a tapering of activity in October, with same home average occupied days dropping to 95.1% [5][4] - The company sold nearly 1,200 homes to end-user home buyers year to date, despite a slowdown in MLS activity [6][7] Company Strategy and Development Direction - The company focuses on portfolio optimization, operational execution, and prudent capital management as part of its strategy [4][6] - The development program is expected to maintain strategic sizing funded by internally generated capital and incremental debt capacity [8][15] - The company is leveraging AI tools to enhance operational efficiency and improve the leasing process [66][67] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the leasing velocity improving and the benefits from the lease expiration management initiative [22][41] - The company anticipates a positive effect on occupancy and pricing power as it enters the spring leasing season next year [42][96] - Management highlighted the importance of controlling expenses and maintaining strength in the top line for future margin expansion [85][86] Other Important Information - The company’s balance sheet is now 100% unencumbered, with zero maturities until 2028 [14][15] - Full year 2025 property tax growth is expected to be in the high 2% area, positively impacting the updated outlook [13][15] Q&A Session Summary Question: Impact of lease expiration strategy on occupancy and new lease trends - Management noted that the shift in lease expirations has led to a decrease in turnover rate and is expected to build occupancy towards the end of the year [19][23] Question: Performance of Midwest markets - Management confirmed continued strength in the Midwest due to good quality of life and affordability, expecting this trend to sustain [26][27] Question: Same store revenue growth deceleration - Management explained that the deceleration is influenced by timing of last year's leasing spreads and strategic acceleration of leasing activity [32][38] Question: Fourth quarter trends and expectations - Management indicated that October showed improved leasing activity, suggesting better trends for November and December [40][41] Question: Stock buybacks versus development funding - Management stated that stock buybacks are being monitored closely and could complement the value created by the development program [48][55] Question: Regulatory updates - Management reported that regulatory activity has been relatively quiet, with proactive engagement with local municipalities [109][111]

Core Performance - American Homes 4 Rent (AMH) reported revenue of $478.46 million for the quarter ended September 2025, reflecting a year-over-year increase of 7.5% [1] - Earnings per share (EPS) for the quarter was $0.47, significantly up from $0.20 in the same quarter last year [1] - The reported revenue exceeded the Zacks Consensus Estimate of $474.98 million by 0.73%, while the EPS surpassed the consensus estimate of $0.46 by 2.17% [1] Revenue Breakdown - Core revenues amounted to $405.62 million, slightly below the four-analyst average estimate of $409.34 million, with a year-over-year change of +7.5% [4] - Non-Same-Home core revenues were reported at $47.8 million, exceeding the average estimate of $45.95 million, representing a year-over-year increase of 14.3% [4] - Tenant charge-backs reached $72.84 million, surpassing the average estimate of $65.34 million, with a year-over-year change of +7.7% [4] - Same-Home core revenues were $357.83 million, below the estimated $363.39 million, but still showing a +6.6% change compared to the previous year [4] - Net earnings per share (diluted) were reported at $0.27, exceeding the average estimate of $0.16 [4] Stock Performance - Over the past month, shares of American Homes 4 Rent have returned -1.9%, contrasting with the Zacks S&P 500 composite's +3.8% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Core Insights - American Homes 4 Rent (AMH) reported quarterly funds from operations (FFO) of $0.47 per share, exceeding the Zacks Consensus Estimate of $0.46 per share, and up from $0.44 per share a year ago, representing an FFO surprise of +2.17% [1][2] - The company achieved revenues of $478.46 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 0.73% and increasing from $445.05 million year-over-year [2] - The stock has underperformed the market, losing about 12.9% since the beginning of the year compared to the S&P 500's gain of 17.2% [3] Financial Performance - Over the last four quarters, American Homes 4 Rent has surpassed consensus FFO estimates three times and topped consensus revenue estimates four times [2] - The current consensus FFO estimate for the upcoming quarter is $0.48 on revenues of $465.79 million, and for the current fiscal year, it is $1.87 on revenues of $1.86 billion [7] Market Outlook - The sustainability of the stock's price movement will depend on management's commentary during the earnings call and future FFO expectations [3][4] - The estimate revisions trend for American Homes 4 Rent was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] - The REIT and Equity Trust - Residential industry is currently ranked in the bottom 41% of Zacks industries, which may impact the stock's performance [8]

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Financial Performance - Net income attributable to common shareholders for Q3 2025 was $99.7 million, or $0.27 per diluted share, up from $73.8 million, or $0.20 per diluted share in Q3 2024, reflecting a significant increase in rents and property revenues [7]. - For the nine-month period ended September 30, 2025, net income attributable to common shareholders was $315.2 million, or $0.85 per diluted share, compared to $275.3 million, or $0.75 per diluted share in the same period of 2024 [14]. - The company reported net income of $116,801 for Q3 2025, compared to $87,640 in Q3 2024, representing a significant increase of 33.3% [41]. - The company’s net income per common share–diluted for Q3 2025 was $0.27, up from $0.20 in Q3 2024, indicating a 35% increase [135]. Revenue Growth - Rents and other single-family property revenues increased by 7.5% year-over-year to $478.5 million in Q3 2025, driven by a rise in the average occupied portfolio to 57,689 homes [8]. - Core revenues for Q3 2025 were $405,621, an increase of 7.3% from $377,440 in Q3 2024 [39]. - Same-Home core revenues for Q3 2025 reached $357,826, up from $344,735 in Q3 2024, reflecting a growth of 3.8% [39]. - Core revenues from the Same-Home portfolio increased by 4.2% to $1.1 billion for the nine-month period ended September 30, 2025 [17]. Operating Income - Core Net Operating Income (Core NOI) from the total portfolio rose by 9.2% to $264.3 million in Q3 2025, supported by a 7.5% increase in core revenues [9]. - Core Net Operating Income (NOI) for Q3 2025 was $264,340, compared to $242,094 in Q3 2024, indicating a year-over-year increase of 9.2% [41]. - Core NOI margin improved to 65.2% in Q3 2025, compared to 64.1% in Q3 2024 [46]. Funds from Operations - Core Funds from Operations (Core FFO) attributable to common share and unit holders increased by 6.2% year-over-year to $0.47 per FFO share in Q3 2025 [10]. - FFO attributable to common share and unit holders was $188,573,000 for Q3 2025, up from $167,334,000 in Q3 2024 [48]. - Core FFO attributable to common share and unit holders increased to $196,692,000 in Q3 2025, compared to $183,793,000 in Q3 2024 [48]. - Adjusted FFO attributable to common share and unit holders for Q3 2025 was $175.528 million, with common distributions of $126.610 million, resulting in a Retained Cash Flow of $48.918 million [141]. Property Management and Expenses - Core property operating expenses for Q3 2025 were $141,281, a rise from $135,346 in Q3 2024, marking an increase of 4.3% [41]. - Property management expenses for Q3 2025 totaled $33.384 million, an increase from $31.973 million in Q3 2024, marking a rise of 4.4% [133]. - General and administrative expenses for Q3 2025 were $20.503 million, compared to $19.247 million in Q3 2024, reflecting a 6.5% increase [133]. Debt and Capitalization - Total debt as of September 30, 2025, was $4,910,000,000, representing 25.6% of total capitalization [76]. - The company reported a net debt and preferred shares to adjusted EBITDAre ratio of 5.1x, indicating a stable financial position [76]. - The fixed charge coverage ratio for the trailing twelve months ended September 30, 2025, was 4.1x, indicating strong ability to cover fixed charges [117]. Market Presence and Growth Strategy - The Company achieved a Same-Home Average Occupied Days Percentage of 95.9% in Q3 2025, with a blended rate growth of 3.6% [10]. - The company anticipates continued growth driven by its acquisition and homebuilding programs, as indicated in its 2025 guidance [36]. - The company plans to enhance its market presence through strategic acquisitions and new developments in the coming years [36]. - The total development pipeline consists of 10,223 lots, with 1,800 - 2,000 expected deliveries for the full year 2025 [91]. Property Portfolio - Total single-family properties owned as of September 30, 2025, reached 60,664 homes, with 651 newly constructed homes delivered during Q3 2025 [21]. - As of September 30, 2025, the company owned over 61,000 single-family properties across various regions in the United States [34]. - The average age of properties in the portfolio was 17.9 years, with a total of 60,664 properties [79]. - The total number of properties across all markets was 53,412, with an average occupied days percentage of 95.9% [64].

Core Insights - The company reported a solid third quarter with a Core FFO per share growth of 6.2% and raised its full-year 2025 guidance midpoint by $0.01 per share to $1.87, indicating a growth of 5.6% over the previous year [3][12][17]. Financial Performance - For Q3 2025, net income attributable to common shareholders was $99.7 million, or $0.27 per diluted share, compared to $73.8 million, or $0.20 per diluted share in Q3 2024, driven by increased rents and property revenues [3][7]. - Rents and other single-family property revenues increased by 7.5% to $478.5 million in Q3 2025, up from $445.1 million in Q3 2024, supported by a larger average occupied portfolio and higher rental rates [4][12]. - Core NOI from the total portfolio rose by 9.2% to $264.3 million in Q3 2025, compared to $242.1 million in Q3 2024, attributed to revenue growth and partially offset by a 4.4% increase in operating expenses [5][12]. Same-Home Portfolio Performance - Core revenues for the Same-Home portfolio increased by 3.8% to $357.8 million in Q3 2025, driven by a 3.5% rise in Average Monthly Realized Rent per property [6][10]. - Core property operating expenses for Same-Home properties rose by 2.4% to $123.0 million in Q3 2025, leading to a Core NOI increase of 4.6% to $234.8 million [6][10]. Year-to-Date Results - For the nine-month period ended September 30, 2025, net income attributable to common shareholders was $315.2 million, or $0.85 per diluted share, compared to $275.3 million, or $0.75 per diluted share for the same period in 2024 [7][9]. - Rents and other single-family property revenues for the nine-month period increased by 8.0% to $1.4 billion, driven by a larger average occupied portfolio [8][10]. Investment and Development - As of September 30, 2025, the company owned 60,664 single-family properties, with an increase of 68 homes during Q3 2025, including 539 newly constructed homes [11][12]. - The company delivered a total of 651 newly constructed homes from its AMH Development Program in Q3 2025 [12]. Capital Structure and Liquidity - The company paid off approximately $426.1 million on its asset-backed securitization, resulting in a fully unencumbered balance sheet [13][14]. - As of September 30, 2025, the company had cash and cash equivalents of $45.6 million and total outstanding debt of $4.9 billion, with a weighted-average interest rate of 4.5% [14][25]. Guidance - The company raised its full-year 2025 Core FFO guidance to a range of $1.86 to $1.88 per share, reflecting improved expectations for Core NOI growth and financing costs [16][17].

Core Viewpoint - Investors are evaluating Safehold (SAFE) and American Homes 4 Rent (AMH) to determine which stock offers better value opportunities at present [1] Group 1: Zacks Rank and Earnings Outlook - SAFE has a Zacks Rank of 2 (Buy), indicating a positive earnings outlook, while AMH has a Zacks Rank of 3 (Hold) [3] - The Zacks Rank system emphasizes companies with positive earnings estimate revisions, suggesting that SAFE has an improving earnings outlook [3][4] Group 2: Valuation Metrics - SAFE has a forward P/E ratio of 9.71, significantly lower than AMH's forward P/E of 17.47 [5] - SAFE's PEG ratio is 1.41, while AMH's PEG ratio is 2.98, indicating that SAFE is expected to grow earnings at a more favorable rate relative to its price [5] - SAFE's P/B ratio is 0.47, compared to AMH's P/B of 1.54, further highlighting SAFE's undervaluation [6] Group 3: Value Grades - Based on the valuation metrics, SAFE earns a Value grade of A, while AMH receives a Value grade of C [6] - The combination of a solid earnings outlook and favorable valuation figures positions SAFE as the superior value option compared to AMH [6]

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Performance Overview - Baron Real Estate Income Fund increased by 5.43% in Q3 2025, outperforming the MSCI US REIT Index which rose by 4.49% [2] - Since inception on December 29, 2017, the Fund's cumulative return is 97.17%, significantly higher than the REIT Index's 41.54% [2][3] Comparative Rankings - As of September 30, 2025, the Fund ranks in the 2nd, 5th, 17th, and 2nd percentiles for the 1-, 3-, 5-year, and since inception periods, respectively, according to Morningstar [4] - The Fund's Institutional Share Class is ranked as the 3rd, 10th, 28th, and 2nd best performing share class in its category for the same periods [4] Market Outlook - The Fund remains optimistic about public real estate prospects, expecting improving business fundamentals and values to contribute to attractive returns [9] - Positive comments from executives of leading real estate companies indicate a potential improvement in real estate fundamentals [12][13][14][15][16] Investment Strategy - The Fund's portfolio consists of 75% REITs, 22% non-REIT real estate companies, and 3.1% cash and cash equivalents as of September 30, 2025 [21] - The Fund's investment approach includes a focus on both REITs and non-REIT real estate companies, allowing for flexibility in capitalizing on market opportunities [20] Sector Analysis - Industrial REITs represent the largest exposure in the Fund, with a positive outlook driven by demand/supply dynamics and e-commerce growth [23] - Health Care REITs and senior housing are expected to benefit from favorable demographic trends and improving fundamentals [27] - The Fund maintains a cautious but optimistic view on office REITs, identifying specific markets with potential for growth [27] Recent Activity - The Fund initiated positions in Jones Lang LaSalle Incorporated and increased holdings in Prologis, Inc. and The Macerich Company during Q3 2025 [44][46][47] - The Fund trimmed its exposure to certain holdings like American Tower Corporation and Equinix, Inc. due to market conditions and growth outlooks [41][49] Future Prospects - The Fund anticipates a pivotal moment for real estate, with expectations of solid growth in business fundamentals and potential for improved valuations [54] - The overall sentiment in the real estate market is cautiously optimistic, with expectations of continued demand exceeding supply [51]