What's in the Cards for Invitation Homes This Earnings Season?

Core Insights - Invitation Homes (INVH) is set to report its third-quarter 2024 results on October 30, with analysts and investors keen to evaluate its performance in the current economic environment [1] Financial Performance - In the last reported quarter, INVH achieved a core FFO per share of 47 cents, aligning with the Zacks Consensus Estimate, driven by increased total revenues and same-store blended rent, although rising interest expenses slightly impacted results [2] - Over the past four quarters, INVH's core FFO per share met the Zacks Consensus Estimate twice, exceeded it once, and fell short once, with an average miss of 0.01% [3] U.S. Apartment Market Overview - The U.S. apartment market absorbed 192,649 market-rate units from July to September 2024, while 162,595 new units were delivered, resulting in an annual supply of 557,842 units, the highest since 1974, with demand at 488,773 units [4] - Occupancy rates in market-rate apartments stood at 94.4%, a slight decline of 10 basis points year-over-year, with rents increasing by 0.2% year-over-year in September, and the average effective rent at $1,838 [5] Company Growth Factors - INVH is expected to benefit from its diverse portfolio located in high-growth markets across the Western U.S., Sunbelt locations, and Florida [6] - The company's third-party management business has been a significant growth driver, with a homebuilder-relationship approach to build-to-rent yielding high investment returns with minimal capital investment [6] Lease Rate Trends - For the period of July to August, INVH reported same-store renewal lease rate growth of 4.4%, down from 5.6% in Q2 2024, while new lease rate growth decreased to 1.9% from 3.6% in Q2 2024 [7] - The blended lease rate growth was 3.7%, down from 5.0% in Q2 2024, with an average occupancy of 97.1%, slightly lower than 97.5% in Q2 2024 [7] Projections and Estimates - The Zacks Consensus Estimate for INVH's rental revenues in Q3 is $644 million, reflecting a 16% increase from the previous year, while total revenues are estimated at $659.5 million, indicating a 6.8% rise [8] - The consensus estimate for quarterly FFO per share remains at 46 cents, suggesting a 4.6% year-over-year increase, but the model does not predict a surprise in FFO this season [9][10]