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EastGroup Properties (NYSE:EGP) Q3 Earnings: What Can You Expect?

in EARNINGS/INVESTING IDEAS by

EastGroup Properties, Inc. (NYSE:EGP) is scheduled to report Q3 earnings results after markets close for trading on October 27, 2020.

The company is expected to report earnings of $0.60/share on revenue of $89.718 million. The consensus earnings per share (EPS) of $0.60/share is based on a poll of 3 analysts and represents a growth in eps of 0.0% over the same quarter last year, when the company reported earnings of $0.60/share.

The revenue forecast of $89.718 million based on a poll of 7 analysts implies a year-over-year (YoY) growth in revenue of 6.9%. Last year the company reported $83.938 million in revenue for the quarter.

Expected to report flat EPS for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $89.72 $83.94 6.9%
EPS $0.60 $0.60 0.0%

Earnings Call Trends

Historically, management has exceeded analyst expectations 6 out of the last 8 tracked quarters, and missed expectations 2 quarters.

What are your expectations from EastGroup Properties, Inc. for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 $0.56 $0.60 7.6% Beat
Q1, 2020 $0.56 $0.60 6.5% Beat
Q4, 2019 $0.58 $0.52 −10.5% Missed
Q3, 2019 $0.54 $0.60 11.9% Beat
Q2, 2019 $0.55 $0.73 33.3% Beat
Q1, 2019 $0.52 $0.56 7.7% Beat
Q4, 2018 $0.55 $0.51 −6.4% Missed
Q3, 2018 $0.50 $0.53 5.9% Beat

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending June 30, 2020, the stock price reacted by increasing 7.8%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
July 28, 2020 $124.07 $133.80 7.8% Increase
April 30, 2020 $111.01 $102.27 −7.9% Decline
April 30, 2020 $137.28 $138.09 0.59% Decline
April 30, 2020 $128.18 $133.78 4.37% Increase

The other question to consider is one of earnings manipulation. There is a lot of pressure on management each quarter to deliver on earnings expectations. The Beneish M-Score is a statistical model that provides some insight into whether the company might be manipulating earnings. With a Beneish M-Score of −2.55, the model suggests that the company is not likely to be an earnings manipulator. A value of −2.55 implies a 0.5% chance of earnings manipulation.

Fundamentals And Technical Analysis

EastGroup Properties, Inc. is currently trading at $137.45/share, up 0.5% for the day. The company is trading at approximately 92.7% of its 52-week high of $148.27/share. The company’s stock price is up 2.7% since the last earnings report and down −0.9% over the previous week.

The company’s 14 Day Relative Price Index (RSI) of 50.60 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NYSE:EGP Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of 45.31 and a forward P/E multiple of 57.58.

EastGroup Properties, Inc.’s current share price also implies a price-to-book (P/B) multiple of 4.44. The following table summarizes some other key fundamental ratios:

Data as of October 21, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 30, 2020
Stock Price (Current) $137.45
P/E Ratio 45.3x
P/E Ratio (Fwd) 57.6x
PEG Ratio 2.0
Total Debt / Total Capital 19.2%
Levered Free Cash Flow $214.2 million
EV / EBITDA 30.5x

Finbox

EastGroup Properties, Inc. is a mid-cap stock with a market capitalization of $5.39 billion and a total enterprise value of $6.666 billion. The company operates in the Real Estate sector and the Equity Real Estate Investment Trusts (REITs) industry.

EastGroup Properties, Inc. (NYSE: EGP), an S&P MidCap 400 company, is a self-administered equity real estate investment trust focused on the development, acquisition and operation of industrial properties in major Sunbelt markets throughout the United States with an emphasis in the states of Florida, Texas, Arizona, California and North Carolina. The Company’s goal is to maximize shareholder value by being a leading provider in its markets of functional, flexible and quality business distribution space for location sensitive customers (primarily in the 15,000 to 70,000 square foot range). The Company’s strategy for growth is based on ownership of premier distribution facilities generally clustered near major transportation features in supply-constrained submarkets. EastGroup’s portfolio, including development projects and value-add acquisitions in lease-up and under construction, currently includes approximately 45.7 million square feet.

Expertise: financial modeling, mergers & acquisitions. Andy is also a founder at finbox.io, where he’s focused on building tools that make it faster and easier for investors to do investment research. Andy’s background is in investment banking where he led the analysis on over 50 board advisory engagements involving mergers and acquisitions, fairness opinions and solvency opinions. Some of his board advisory highlights: - Sears Holdings Corp.’s $620 mm spin-off via rights offering of Sears Outlet, Hometown Stores and Sears Hardware Stores. - Cerberus Capital Management’s $3.3 bn acquisition of SUPERVALU Inc.’s New Albertsons, Inc. assets. Andy can be reached at andy@finbox.io or at +1 (516) 778-6257.

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