Rockville, Maryland-based Federal Realty Investment Trust (FRT) is a real estate investment trust (REIT) that owns, manages, develops, and redevelops premium retail and mixed-use properties. Valued at a market cap of $8.7 billion, the company mainly focuses on investing in densely populated, well-off communities where retail demand is high. 

Shares of this REIT have underperformed the broader market over the past 52 weeks. FRT has gained 4.1% over this time frame, while the broader S&P 500 Index ($SPX) has soared 22.3%. Moreover, on a YTD basis, the stock is down 6.2%, compared to SPX’s 4% rise. 

Narrowing the focus, Federal Realty has also lagged behind the Real Estate Select Sector SPDR Fund’s (XLRE) 11.2% return over the past 52 weeks and 3.4% gain on a YTD basis.

Shares of FRT plummeted 6.1% after its Q4 earnings release on Feb. 13 as the company delivered weaker-than-expected Q4 revenues of $311.4 million. However, the top line improved 6.7% year-over-year. Adding to the positives, its FFO advanced 5.5% from the year-ago quarter to $1.73 per share and came in line with the Street’s forecast. Results reflected healthy leasing activity and significant occupancy gains at its properties but could not impress the investors. 

The company provided its initial guidance for fiscal 2025 and expects FFO per share in the range of $7.10-$7.22. 

For the current fiscal year, ending in December, analysts expect Federal Realty’s FFO to grow 5.6% year over year to $7.15 per share. The company’s earnings surprise history is mixed. It topped or met the Wall Street estimates in two of the last four quarters while missing on two other occasions. 

Among the 16 analysts covering the stock, the consensus rating is a “Strong Buy,” which is based on 11 “Strong Buy,” one “Moderate Buy,” and four “Hold” ratings. 

This configuration is slightly more bullish than three months ago, with 10 analysts suggesting a “Strong Buy” rating. 

On Jan. 17, Truist analyst Ki Bin Kim maintained a “Buy” rating on FRT but lowered its price target to $113, which indicates a 7.6% potential upside from the current levels. 

The mean price target of $123.17 represents a 17.3% upside from Federal Realty’s current price levels, while the Street-high price target of $135 suggests an upside potential of 28.5%.