STAG Industrial (STAG) Q2 2024 earnings summary

Executive summary

• Net income per share rose to $0.33 in Q2 2024, up 13.8% year-over-year, with net income attributable to common stockholders up 15.9% to $59.7 million and total net income reaching $61.1 million, driven by higher rental income and gains on property sales.

• Core FFO per diluted share increased 8.9% to $0.61, and Cash NOI grew 10.3% to $148.4 million year-over-year.

• Acquired 10 buildings (2.2M sq ft) for $225.6M at a 6.7% cash cap rate and sold 7 buildings (1.1M sq ft) for $78.2M in Q2 2024.

• Portfolio occupancy was 97.1% overall and 97.5% for the operating portfolio as of June 30, 2024, with same store occupancy at 97.4%.

• Moody’s upgraded outlook to 'Positive' and maintained Baa3 rating on June 26, 2024.

Financial highlights

• Net income attributable to common stockholders was $59.7M for Q2 2024, up from $51.6M in Q2 2023.

• Cash NOI for Q2 2024 was $148.4M, up 10.3% year-over-year; Same Store Cash NOI increased 6.1%.

• Adjusted EBITDAre for Q2 2024 was $138.7M, up 10.6% year-over-year.

• Cash Available for Distribution was $95.1M in Q2 2024, up 9.1% year-over-year.

• Rental income for Q2 2024 was $186.5M, up from $171.4M in Q2 2023.

Outlook and guidance

• 2024 Core FFO per share guidance: $2.36–$2.40; Same Store Cash NOI growth expected at 5.0%–5.5%; retention at 75%; cash rent change at 27.5%–30.0%.

• Acquisition volume guidance: $350M–$650M; disposition volume: $100M–$150M.

• Management expects to leverage strong operating results and liquidity to drive further growth in 2024 and 2025.

• U.S. economic growth is expected to remain low with elevated recession risk; company highlights minimal floating rate debt exposure and strong liquidity.

• Expected average same store portfolio occupancy loss moderated to 25 basis points.