Long Bench INVH 3Q21 Core FFO of $0.38/share + $0.01/share vs. Hedgeye and -$0.01/share vs. Consensus. The delta to our model came primarily on ~$10mm of lower cash interest expense in the quarter, with total NOI only off by just ~$1.3 million in our model. FY21 Core FFO guidance raised +3.5% at the midpoint to $1.47 to $1.51 vs. Hedgeye at $1.49, so right down the middle and consistent with our view that both guidance and consensus were too conservative. Not sure this is enough to really move the stock in either direction given the "miss" relative to consensus, but we remain long of SFR alongside Coast Apartments and would again highlight the quarterly sequential trend in leasing spreads since 3Q20: +4%/+4.9%/+5.4%/+8%/+10.6% so a clear RoC acceleration which is raising and elongating the SSRev and SSNOI growth tails. Renewal leasing spreads moving into the high-single-digit range (+7.8%) in the quarter is a very important metric, given INVH's exceptionally low turnover at just 6.3% or less than 24% on a trailing basis. The bias is to the upside on numbers for both INVH and peer AMH heading into FY22.
Figure 1: INVH 3Q21 Earnings Variances
Prior Notes:
10.28.21 - REIT RECAP | 10/28/21 | AVB 3Q21 RESULTS
10.27.21 - REIT RECAP | 10/27/21 | EXR 3Q21 RESULTS
10.27.21 - REITS DAILY BRIEF | 10.27.21 | (3Q21 Earnings, AVB, EXR, Office)
10.26.21 - REIT RECAP | 10/26/21 | EQR 3Q21 RESULTS
10.26.21 - REITS DAILY BRIEF | 10.26.21 | (EQR, REXR)
10.25.21 - SUNDAY NIGHT REIT READ | 10.24.21 | (POSITION MONITOR)
10.21.21. - REIT RECAP | 10/21/21 | REXR 3Q21 RESULTS
10.20.21 - REITS DAILY BRIEF | 10.20.21 | (EGP, PLYM, REXR, ILPT)
10.19.21 - VIDEO | American Homes 4 Rent (AMH) Thesis
10.19.21 - REITS DAILY BRIEF | 10.19.21 | (COLD, SLG, VNO, AMH, U.S. Office Utilization)
10.18.21 - REITS DAILY BRIEF | 10.18.21 | (PLD)
10.17.21 - SUNDAY NIGHT REIT READ | 10.17.21 | (PLD, POSITION MONITOR)
10.15.21 - REIT RECAP | 10/15/21 | PLD 3Q21 RESULTS
10.13.21 - REITS DAILY BRIEF | 10.13.21 | (PLD)
10.10.21 - SUNDAY NIGHT REIT READ | 10.10.21 | (POSITION MONITOR UPDATE)
10.8.21 - BLACK BOOK ROUND-UP | AMERCO (UHAL)
10.7.21 - BEST IDEA ROUND-UP | AMERICOLD REALTY TRUST (COLD)
Please e-mail with any questions.
Rob Simone, CFA
Managing Director
Twitter: @HedgeyeREITs
