RBC Capital Markets Maintains COPT Outlook

COLUMBIA, MD—Last week Corporate Office Properties Trust announced that its diluted earnings per share, or FFOPS, was zero for the quarter ended March 31, 2014,  compared to $0.11 in the first quarter of 2013. Its portfolio was 89.8% occupied and 91.1% leased as of March 31. It had completed some 446,000 square feet in total leasing for its core office properties, at a 56% renewal rate. It also had eight properties totaling 1.2 million square feet under development, of which half was pre-leased. COPT also announced it was raising its guidance for its 2014 FFOPS by one penny to a new range of $1.85–$1.92. Said Roger A. Waesche, Jr., COPT’s president and CEO: “We are at a positive inflection point, and expect 2014 will be a rewarding year for shareholders.”

RBC Capital Markets is inclined to agree. In a research note the firm announced it was maintaining its Sector Perform rating and $28/share price target for the REIT in part because its fundamentals appear to be turning. “We expect 2Q14 will mark the cyclical low point of the earnings trend,” it said.