Vornado Stock Rises 81% in Six Months: Will the Trend Last?

Core Viewpoint - Vornado Realty Trust (VNO) has experienced an 81% increase in stock price over the past six months, significantly outperforming its industry's growth of 17.3% [1] Group 1: Financial Performance - In Q3 2024, Vornado reported funds from operations (FFO) of 52 cents per share, surpassing the Zacks Consensus Estimate of 51 cents, although this represents a 21.2% decline year-over-year [2] - The company achieved better-than-expected top-line growth during the same quarter [2] Group 2: Market Position and Strategy - Vornado focuses on high-rent, high-barrier-to-entry markets, which, along with a diversified tenant base, is expected to drive steady cash flows and long-term growth [3] - The demand for office spaces in New York remains strong, with Vornado leasing 454,000 square feet across 18 transactions at an initial rent of $92 per square foot in Q3 2024 [4] - The company is well-positioned to benefit from rising rents in newly constructed or redeveloped assets that offer ample amenities [5] Group 3: Development and Financial Strength - Vornado is engaging in opportunistic developments and divestitures, with strategic sellouts providing capital for reinvestment in developments and redevelopments [6] - The company sold a 49.9% interest in a property for net proceeds of $2 million and two condominium units for approximately $31.6 million in the first nine months of 2024 [6] - As of September 30, 2024, Vornado had $2.6 billion in liquidity, including $1 billion in cash and cash equivalents, and $1.6 billion available under its revolving credit facilities [7]