Mid-America Apartment's Q4 FFO Beats Estimates, Revenues Grow Y/Y

Core Insights - Mid-America Apartment Communities (MAA) reported Q4 2025 core funds from operations (FFO) per share of $2.23, exceeding the Zacks Consensus Estimate of $2.22, with no change from the previous year [2][10] - Rental and other property revenues for Q4 were $555.6 million, slightly below the Zacks Consensus Estimate of $557.8 million, but up 1% year-over-year [3][10] - For the full year 2025, core FFO per share was $8.74, surpassing the consensus estimate of $8.72 but lower than the prior year's $8.88 [3] Financial Performance - The same-store portfolio's revenues decreased by 0.1% year-over-year, while property operating expenses rose by 0.7%, leading to a 0.5% decline in net operating income (NOI) [4] - Average effective rent per unit fell by 0.3%, with average physical occupancy improving to 95.7%, a 10 basis point increase from the prior year [5][10] - The same-store effective blended lease rate growth was negative 1.7%, although this represented an improvement of 40 basis points from the previous year [6] Portfolio Activity - MAA acquired a land parcel in Northern Virginia for a 287-unit multifamily apartment community, with development expected to start in the second half of 2026 [7] - In October 2025, MAA acquired land in Kansas City for a phase II expansion and began construction on a 280-unit community in Phoenix, AZ [8] - As of December 31, 2025, MAA had eight communities under development with total expected costs of $306.4 million [8] Balance Sheet Position - MAA ended Q4 2025 with cash and cash equivalents of $60.3 million, up from $32.2 million at the end of Q3 2025 [11] - The company had a strong balance sheet with $879.2 million in cash and available capacity under its unsecured revolving credit facility, and increased borrowing capacity to $1.5 billion [11][12] - MAA's net debt/adjusted EBITDAre ratio was 4.3 times, with total debt outstanding at $5.41 billion and an average maturity of 6.4 years [12] 2026 Guidance - MAA projects Q1 2026 core FFO per share between $2.05 and $2.17, with a midpoint of $2.11, aligning with the Zacks Consensus Estimate of $2.16 [13] - For 2026, the company anticipates same-store property revenue growth of negative 0.20% to 1.30% and NOI growth between negative 1.70% and 0.30% [14] - Average physical occupancy for the same-store portfolio is expected to range from 95.3% to 95.9%, with a midpoint of 95.60% [14]