Jefferies Sees Upside in Realty Income (O) as Net Lease REIT Valuations Remain Depressed

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On June 1, Jefferies initiated sum of Realty Income Corporation (NYSE:O) with a Buy standing and a $69 terms target, compared with its erstwhile people of $75. The steadfast began sum of retail nett lease existent property concern trusts with a favorable presumption of the sector. According to the analyst, the palmy execution of concern pipelines could assistance thrust a re-rating toward humanities valuation multiples.

In a probe note, Jefferies said the nett lease assemblage is trading astatine the third-largest discount to its 10-year mean valuation wrong the REIT space. The steadfast noted that nett lease REITs are being grouped with “the aforesaid cohort arsenic secular challenged sectors” specified arsenic bureau and laboratory properties, contempt what it described arsenic “intact fundamentals.”

Earlier, connected May 13, Mizuho lowered its terms proposal connected Realty Income to $66 from $68. It reiterated a Neutral standing connected the stock. The steadfast pointed to ongoing macroeconomic and involvement complaint uncertainty affecting triple-net existent property concern trusts.

Realty Income Corporation (NYSE:O) is simply a existent property concern spot focused connected acquiring, owning, and managing freestanding commercialized properties. These properties are leased nether semipermanent nett lease agreements to a diversified radical of tenants, including investment-grade, investment-grade-equivalent, and different operators.

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