Vornado Realty rises after Evercore double upgrade

Vornado Realty Trust

20/08/2024 15:56

** Shares of Vornado Realty Trust  VNO.N  rise 2.3% to
$33.69 early Tues after Evercore upgrades to "outperform" from
"underperform", saying NYC-focused office REIT could continue to
outpace its peers near term
    ** Brokerage bumps PT by $6 to $38, implying ~15% upside to
stock's last close
    ** Evercore analyst Steve Sakwa cites several catalysts for
VNO over next 6 to 12 months, including confidence in co either
leasing or selling 770 Broadway building to a high-credit tenant
at valuation well above stock's implied value
    ** This deal would help validate VNO's portfolio value and
reduce near term risk of backfilling recent Meta Platform
 META.O  lease expiration, Sakwa says
    ** PENN 2's leasing activity is strong which is paired with
an overall growing pipeline of 2.6 mln-square-feet for NYC
market, Sakwa says, adding a few large tenants are eyeing this
asset and deals could transpire before year-end
    ** Sakwa also points to decline in 10-yr treasury yield and
softened SOFR (Secured Overnight Financing Rate) curve, saying
VNO could benefit given its higher floating rate debt exposure
and if current Fed rate cut expectations remain in place
    ** VNO shares on Aug 6 closed up 12.7% at $30.72 after co
posted Q2 beat and said its JV entered deal with Uniqlo, brand
owned by Japan's Fast Retailing  9983.T 
    ** Shares last up 0.8% at $33.20 on Tues, up 17.5% YTD

 (Lance Tupper is a Reuters market analyst. The views expressed
are his own)
 ((lance.tupper@thomsonreuters.com
lance.tupper@tr.com 1-646-279-6380))