I have formerly spent over 3 years as a trader in U.S. Stock Market and is now semi-stepped down. I work on a full time basis for Import Tourism specializing in quicker moving active shares with a short term view on investment opportunities and trends.
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OVERLAND PARK, Kan., July 8, 2019 – Shares of QTS Realty Trust Inc. (NYSE: QTS) declined -0.82% to $45.82. The stock traded total volume of 159.605K shares lower than the average volume of 432.00K shares.
QTS Realty Trust Inc. (QTS) reported net income of $12.50M, or 20 cents per share.
Net income recognized in the first quarter of 2019 was $21.10M ($0.20 net income per basic and diluted common share), contrast to net loss of $0.30M ($0.02 net loss per basic and diluted common share) recognized in the first quarter of 2018. The increase was mainly driven by a gain on sale of real estate of about $13.40M in the first quarter of 2019 associated with the Company’s assets that were contributed to a joint venture as well as a reduction in restructuring expenses of about $8.50M related to costs incurred in the prior year associated with the Company’s planned growth plan.
QTS generated total revenues of $112.70M in the first quarter of 2019, a boost of 12.3% contrast to total Core revenue of $100.40M in the first quarter of 2018. MRR as of March 31, 2019 was $32.00M contrast to Core MRR as of March 31, 2018 of $27.90M.
QTS generated $58.80M of Adjusted EBITDA in the first quarter of 2019, a boost of 17.3% contrast to Core Adjusted EBITDA of $50.20M for the first quarter of 2018.
In Addition To, QTS generated Operating FFO of $38.20M in the first quarter of 2019, a boost of 3.5% contrast to Core Operating FFO of $36.90M in the first quarter of 2018. Excluding the effects of the Company’s mainly non-cash deferred tax benefit/(expense), Operating FFO was $38.40M in the first quarter of 2019, a boost of 6.3% contrast to Core Operating FFO of $36.10M in the first quarter of 2018.
During the quarter ended March 31, 2019, QTS reached new and modified renewal leases aggregating to $11.30M of incremental annualized rent. The Company’s first quarter leasing performance was driven by strong sales in its hybrid colocation product, contributing the majority of the quarter’s incremental annualized rent.
During the quarter ended March 31, 2019, QTS renewed leases with total annualized rent of $11.50M at an average rent per square foot of $988, which was 1.6% higher than the annualized rent before their respective renewals. There is variability in the Company’s renewal rates based on the mix of product types renewed, and renewal rates are generally expected to increase in the low to mid-single digits as contrast to pre-renewal pricing. Rental Churn (which the Company defines as MRR lost in the period to a customer intending to fully exit the QTS platform in the near term contrast to total MRR at the starting of the period) was 1.3% for the three months ended March 31, 2019.
Balance Sheet and Liquidity
As of March 31, 2019, the Company’s total indebtedness, inclusive of its pro rata share of joint venture debt, was about $1.30B, resulting in a net debt to annualized Adjusted EBITDA of 5.5x. The Company’s leverage ratio pro forma for the effects of cash expected to be received at or before March 1, 2020 upon the full physical settlement of, and issuance of, 3,762,500 shares of common stock following the forward equity sale agreement reached during the first quarter of 2019, assuming such proceeds were used to repay a portion of the Company’s outstanding debt, is about 4.9x. This ratio compares to the 5.7x net debt to annualized Adjusted EBITDA reported in the fourth quarter of 2018 and remains in line with Company expectations.
In February 2019, QTS conducted an underwritten offering of 7.762M shares of its Class A common stock, consisting of 4.00M shares issued by the Company during the first quarter of 2019 and 3.762M shares which will be issued on a forward basis, in each case at a price of $41.50 per share. The Company received net proceeds of about $159.0M from the issuance of 4.00M shares during the first quarter, which it used to repay amounts outstanding under its unsecured revolving credit facility. The Company anticipates physically settling the forward sale (by the delivery of shares of common stock) and receiving proceeds of about $148.0M from the sale of the 3,762,500 shares of common stock by March 1, 2020, although the Company has the right to elect settlement before that time.
As of March 31, 2019, the Company had total available liquidity of about $848.0M which was comprised of $681.0M of available capacity under the Company’s unsecured revolving credit facility, about $148.0M available proceeds at the Company’s election to physically settle the aforementioned forward equity sale, and about $19.0M of cash and cash equivalents.
QTS has the market capitalization of $2.52B and its EPS growth ratio for the past five years was -49.20%. The return on investment ratio of the Company stands at 1.00%. Price to sales ratio was 5.60.