AvalonBay (AVB) Q2 FFO & Revenues Beat Estimates, View Raised

Core Viewpoint - AvalonBay Communities (AVB) reported strong second-quarter 2024 results, with core funds from operation (FFO) per share of $2.77, exceeding estimates and reflecting a 4.1$726 million, surpassing the Zacks Consensus Estimate of $718.5 million, and marking a 5.1$672.9 million, with same-store residential revenues also climbing 3.2% to $666.2 million [2] - Same-store average revenue per occupied home rose to$2,989, up from $2,897 in the prior year [2] Operational Metrics - Same-store residential operating expenses increased by 3.8$204.1 million, leading to a same-store residential NOI growth of 3.0% to $462.1 million [2] - The same-store economic occupancy remained stable at 96$2.54 billion [2] - In Q2, AVB acquired Avalon at Pier 121 for $62.1 million and sold three communities for$181.7 million [3] Balance Sheet Strength - As of June 30, 2024, AvalonBay had $545.8 million in unrestricted cash and no outstanding borrowings under its credit facilities [4] - The annualized net debt-to-core EBITDAre ratio was 4.2 times, with unencumbered NOI at 95$2.66 and $2.76, with a full-year estimate now between$10.92 and $11.12, indicating a 3.7% increase at the midpoint compared to previous guidance [5] - Same-store residential revenue growth is projected at 3.5% at the midpoint, with operating expenses expected to rise by 4.8% [5] Industry Performance - Other residential REITs, such as UDR Inc., Essex Property Trust Inc., and Equity Residential, also reported positive results and raised their full-year guidance, indicating a healthy demand and modest supply in the sector [7][8]