Berenberg Bank analysts provided their review on Realty Income Corporation (NYSE:O) following the recently reported Q1 results, with FFO of $1.01 and revenue of $807.3 million, beating the consensus estimate of $765.88 million.
The analysts view the quarterly results positively, with the company reiterating its 2022 guidance implying 9% year-over-year growth. Commentary on the call indicated that deal flow remains strong, with some discernible increase in cap rates.
According to the analysts, the company is also well positioned for inflation, with nearly 12% of the portfolio expiring through 2024 and rent recapture trending over 105%. While overall cap rates for the company’s acquisition targets are generally lower than the net lease average, cost of capital remains favorable and the analysts support the company making headway into other net lease categories (casinos), where cap rates are higher.