Four Corners Property Trust
FCPT
recently shelled out $12.3 million for purchasing a Cheesecake Factory property and a dual-tenant Starbucks
SBUX
and AT&T
T
property. The moves came as part of its portfolio-expansion efforts, with real estate leased to strong credit operators.
The buyouts seem a strategic fit for FCPT and are likely to generate steady revenues over the long term. Located in a highly trafficked corridor in Kansas, these properties, which are corporate-operated under net leases, have a weighted average of roughly seven years of residual term. The transaction was priced at a 6.6% cap rate, excluding transaction costs.
Apart from the latest acquisition, Four Corners recently announced the acquisition of a Bubba’s 33-restaurant property for $3.1 million. Positioned in an extremely trafficked corridor in Texas, this is the last property to be acquired from the seven-property, $17.1 million outparcel portfolio transaction initially announced in July 2022.
Four Corners has indeed been on an acquisition spree. The company shelled out $5.4 million for purchasing three Caliber Collision properties and $6.4 million for acquiring two WellNow Urgent Care properties from ComptonAddy.
The Caliber Collision properties are located in highly trafficked corridors in Indiana and corporate-operated under net leases with a weighted average of around five years of residual term. The WellNow Urgent Care properties are newly built and are positioned in strong retail corridors in Ohio. The properties are corporate-operated under net leases with a residual term of 10 years.
Primarily engaged in the ownership and acquisition of high-quality restaurants and retail properties, Four Corners seeks potential acquisition opportunities to enhance its portfolio. In the third quarter of 2022, FCPT acquired 26 properties for a combined purchase price of $69.9 million at an initial weighted average cash yield of 6.3%.
However, Four Corners currently carries a Zacks Rank #4 (Sell). Shares of FCPT have rallied 11.5% so far in the quarter, outperforming the
industry
’s increase of 7.7%.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks from the REIT sector are
VICI Properties Inc.
VICI
and
Lamar Advertising Company
LAMR
, each carrying a Zacks Rank #2 (Buy) at present. You can see
the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here
.
The Zacks Consensus Estimate for VICI Properties’ fourth-quarter 2022 FFO per share has moved marginally north to 51 cents over the past two months.
The Zacks Consensus Estimate for Lamar Advertising Company’s ongoing year’s FFO per share has been raised 1.4% over the past month to $7.34.
Note:
Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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