With a market cap of $31.4 billion, AvalonBay Communities, Inc. (AVB) is a leading real estate investment trust (REIT) focused on developing, acquiring, and managing luxury apartment communities in high-barrier-to-entry markets across the United States. With a strong presence in major metropolitan areas like New York, California, and the Pacific Northwest, the company continues to expand into emerging markets such as Raleigh-Durham, Southeast Florida, and Texas.
Shares of the apartment building owner have outperformed the broader market over the past 52 weeks. AVB has gained 27.5% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 17%. Moreover, shares of AVB are up 1.7% on a YTD basis, compared to SPX’s 1.3% gain.
Zooming in further, the Arlington, Virginia-based company’s outperformance becomes more evident when compared to the Real Estate Select Sector SPDR Fund’s (XLRE) 10.7% gain over the past 52 weeks.
Shares of AvalonBay Communities fell 1.1% following its Q4 2024 earnings release on Feb. 5. The company reported weaker-than-expected core FFO per share of $2.80 and revenue of $740.5 million. Additionally, operating costs surged, with property management and other indirect expenses rising 40.1% year-over-year to $51.4 million and interest expenses increasing 19.2% to $59 million, raising concerns.
For the current fiscal year, ending in December 2025, analysts expect AVB’s core FFO per share to grow 4.3% year-over-year to $11.48. The company’s earnings surprise history is mixed. It beat the consensus estimates in three of the last four quarters while missing on another occasion..
Among the 24 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on 10 “Strong Buy” ratings, one “Moderate Buy,” and 13 “Holds.”
This configuration is more bullish than three months ago, with seven “Strong Buy” ratings on the stock.
On Feb. 21, Mizuho lowered AvalonBay’s price target to $238 while maintaining an “Outperform" rating, reflecting updated 2025 earnings estimates and initiated 2026 projections following the company's Q4 results.
As of writing, AVB is trading below the mean price target of $237.97. The Street-high price target of $265 implies a potential upside of 18.5% 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.
