With a market cap of $33.4 billion, New York-based VICI Properties Inc. (VICI) specializes in gaming, hospitality, and entertainment real estate. Its portfolio includes 93 experiential assets across the U.S. and Canada, featuring iconic Las Vegas properties and partnerships with top experiential brands.
Shares of the hospitality and entertainment REIT have underperformed the broader market over the past 52 weeks. VICI has risen 8.1% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 32.4%. In 2024, shares of VICI are down 1.1%, compared to SPX’s nearly 21% gain on a YTD basis.
Zooming in further, VICI’s underperformance becomes more evident when compared to the Real Estate Select Sector SPDR Fund’s (XLRE) 23.6% gain over the past 52 weeks and 8.3% return on a YTD basis.
On Oct. 31, VICI Properties raised the lower end of its full-year funds from operations (FFO) outlook after reporting Q3 revenue of $964.7 million and FFO of $0.57 per share, both surpassing analysts' expectations. The company's strategic expansion into experience-based real estate categories, including wellness resorts and indoor water parks, reflects its focus on capitalizing on increased consumer spending on experiences. However, despite reporting robust Q3 earnings results, shares of VICI fell over 1% the following day.
For the current fiscal year, ending in December, analysts expect VICI’s FFO to grow 5.1% year-over-year to $2.26 per share. The company’s earnings surprise history is promising. It beat or met the consensus estimates in the last four quarters.
Among the 21 analysts covering the stock, the consensus rating is a “Strong Buy.” That’s based on 17 “Strong Buy” ratings, one “Moderate Buy,” and three “Holds.”
This configuration is slightly more bullish than three months ago, with 16 “Strong Buy” ratings on the stock.
On Nov. 1, JMP Securities analyst Mitch Germain raised VICI Properties' price target to $35, maintaining an “Outperform" rating, citing strong portfolio quality, durable cash flows, and an accretive investment strategy.
As of writing, VICI is trading below the mean price target of $35.84. The Street-high price target of $43, implies a potential upside of 36.1% from the current price.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
