Raymond James has upgraded its rating for Centerspace (CSR, Financial) to "Strong Buy," increasing their price target from $66 to $69. The firm highlights a significant valuation gap that has emerged in comparison to other multifamily properties, attributed to recent market fluctuations. Despite a challenging market climate, Centerspace's shares have experienced unjustified declines, according to Raymond James. The firm notes a positive trend in the company's foundational metrics, particularly the uptick in rental pricing seen in the Midwest, with notable progress in Minneapolis, where Centerspace is based. The analyst expresses optimism about continued growth in these areas, suggesting a favorable outlook for the stock.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 12 analysts, the average target price for Centerspace (CSR, Financial) is $70.54 with a high estimate of $79.00 and a low estimate of $64.50. The average target implies an upside of 19.44% from the current price of $59.06. More detailed estimate data can be found on the Centerspace (CSR) Forecast page.
Based on the consensus recommendation from 12 brokerage firms, Centerspace's (CSR, Financial) average brokerage recommendation is currently 2.3, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Centerspace (CSR, Financial) in one year is $62.78, suggesting a upside of 6.3% from the current price of $59.06. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Centerspace (CSR) Summary page.
CSR Key Business Developments
Release Date: May 02, 2025
- Core FFO: $1.21 per diluted share for Q1.
- Same Store NOI Growth: 2.1% year-over-year increase.
- Same Store Revenue Growth: 3.5% increase compared to Q1 2024.
- Occupancy Rate: 95.8%, a 120 basis point year-over-year increase.
- Same Store Expense Increase: 5.8% year-over-year, primarily due to property taxes.
- Debt Cost: Weighted average debt cost of 3.6%.
- Liquidity: Over $223 million in total liquidity.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Centerspace (CSR, Financial) reported a 120-basis point year-over-year improvement in weighted average occupancy for its same-store portfolio.
- The company achieved a strong average physical occupancy rate of 96% with April renewal retention around 57%.
- Blended leasing spreads increased by 70 basis points in the first quarter, continuing a positive trend into April.
- Centerspace (CSR) maintained a healthy rent-to-income ratio of 21.6%, with bad debt remaining low at roughly 40 basis points.
- The company reaffirmed its guidance for the full year, projecting core FFO of $4.98 per share and same-store NOI growth of 2.25%.
Negative Points
- Same-store expenses increased by 5.8% year-over-year, primarily driven by property taxes, creating a challenging year-over-year comparison.
- Denver market faced supply pressure, impacting new lease rates, although improvement is expected later in the year.
- Retention rates were lower in some markets, notably Denver, due to higher supply and more choices in the market.
- Omaha experienced a 220 basis point sequential decline in occupancy due to forced move-outs related to value-add projects.
- The company faces broader market volatility, impacting capital markets and creating a disconnect between public and private market pricing.
