Jefferies began coverage on InvenTrust Properties (IVT, Financials) with a Hold rating and $33 price target, citing rising profits and valuation concerns.
The investment bank is underlined as a main driver of profit growth in the company's portfolio, which is mostly anchored by supermarket tenants and focused in Sunbelt areas. The expansion rate is on par with Urban Edge Properties (UE, Financials) and rivals such as Phillips Edison & Company (PECO, Financials).
Jefferies observed that while InvenTrust shares, which trade at $30.51, near a 52-week high of $31.37, reflect the portfolio quality and robust balance sheet of the REIT, their premium valuation seems completely priced at present levels.
Strong market performance is reflected in the year-to-date rise of 20.40% in the stock price; Jefferies noted possible hazards related to valuation and the short-term effect of interest rates.
Bank of America Securities analysts pointed out that the company's most recent stock issuance points to preparedness to seek outside development prospects, maybe via purchases of premium grocery-anchored complexes.
According to the Jefferies research, investor interest in shopping centers—including from companies like Blackstone—is being driven by the Sunbelt region's quicker growth, limited retail supply, and better returns. These elements help to explain the general good situation for the retail REIT industry.
