Phillips Edison & Company, Inc. (PECO) Q3 2025 Earnings Call Transcript
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 24 2025
0mins
Should l Buy PECO?
Source: SeekingAlpha
NAREIT FFO Third quarter NAREIT FFO increased to $89.3 million or $0.64 per diluted share, reflecting year-over-year per share growth of 6.7%. This growth is attributed to the high-performing grocery-anchored and necessity-based portfolio that generates reliable, high-quality cash flows.
Core FFO Third quarter core FFO increased to $90.6 million or $0.65 per diluted share, reflecting year-over-year per share growth of 4.8%. This growth is driven by both internal and external growth factors.
Comparable Renewal Rent Spreads Record-high comparable renewal rent spreads of 23.2% in the third quarter, attributed to strong leasing activity and the strength of the retail environment.
Comparable New Leasing Rent Spreads Comparable new leasing rent spreads for the quarter remained strong at 24.5%, reflecting the strength of the retail environment.
Portfolio Occupancy Portfolio occupancy ended the quarter at 97.6% leased, with anchor occupancy at 99.2% and same-store in-line occupancy at 95%, a sequential increase of 20 basis points. This is supported by a robust leasing pipeline.
Development and Redevelopment Projects PECO has 22 projects under active construction with a total investment of $75.9 million and average estimated yields between 9% and 12%. Year-to-date, 14 projects were stabilized, delivering over 222,000 square feet of space and an incremental NOI of approximately $4.3 million annually.
Gross Acquisitions Year-to-date gross acquisitions at PECO's share reached $376 million, including $96 million of assets acquired since June 30. These acquisitions include unanchored centers with reliable fundamentals and a stronger long-term growth profile.
Net Debt to Adjusted EBITDA Net debt to trailing 12-month annualized adjusted EBITDA was 5.3x as of September 30, 2025, compared to 5.1x on the last quarter annualized basis.
Same-Center NOI Growth Reaffirmed guidance for 2025 same-center NOI growth at 3.35% at the midpoint. The growth rate for the fourth quarter of 2025 is expected to be between 1% and 2%, influenced by the timing of recoveries in 2024.
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Analyst Views on PECO
Wall Street analysts forecast PECO stock price to rise
8 Analyst Rating
2 Buy
6 Hold
0 Sell
Hold
Current: 37.850
Low
36.00
Averages
39.29
High
43.00
Current: 37.850
Low
36.00
Averages
39.29
High
43.00
About PECO
Phillips Edison & Company, Inc. is a real estate investment trust (REIT). The Company's business is conducted through Phillips Edison Grocery Center Operating Partnership I, L.P. It invests primarily in omnichannel grocery-anchored neighborhood and community shopping centers that have a mix of creditworthy national, regional, and local retailers that sell necessity-based goods and services in demographic markets throughout the United States. Its portfolio primarily consists of neighborhood centers anchored by the #1 or #2 grocer tenants by sales within their respective formats by trade area. The Company manages approximately 329 shopping centers, including 303 wholly owned shopping centers and 26 shopping centers owned through joint ventures, which comprise approximately 36.8 million square feet in 31 states.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Investment Opportunities in Monthly Dividend Stocks
- Stability of REITs: Realty Income's monthly dividend of $0.27 per share marks its 667th consecutive month of payouts, and it has increased dividends annually since 1994, demonstrating strong stability and reliable cash flow in the commercial real estate sector.
- Advantages of BDCs: Main Street Capital pays a monthly dividend of $0.26 and has increased its payouts for 18 consecutive years, focusing on lower middle-market companies with revenues between $10 million and $150 million, showcasing its unique competitive edge in providing debt and equity solutions.
- Retail REIT Market Strategy: Phillips Edison & Company offers a monthly dividend of $0.11 with a high occupancy rate of 97.3%, focusing on neighborhood shopping centers and successfully attracting 5,500 tenants, reflecting its strong adaptability in the retail market.
- Long-Term Return Potential: Over the past decade, Realty Income and Main Street Capital have achieved annualized returns of 6.4% and 8.3%, respectively, while Phillips Edison averages a 7% annual return, indicating their long-term growth potential in dividend investment strategies.
See More
Real Estate Sector Holds Steady Amid Market Turmoil; Analyst Highlights Two Stocks
- Real Estate Resilience: Despite overall market declines, the real estate sector posted a 1.5% gain last week, demonstrating resilience amid risk sell-offs, which may attract more investor interest.
- Analyst Stock Favorability: Wolfe Research's technical analyst Rob Ginsberg highlighted Phillips Edison & Co.'s bullish chart pattern, noting its current dividend yield of approximately 3.3%, appealing to income-seeking investors.
- Earnings Beat Expectations: Phillips Edison recently reported fourth-quarter core funds from operations (FFO) of 66 cents per share on revenue of $187.6 million, exceeding analyst expectations and indicating strong operational performance.
- Market Outlook Divergence: While analysts are divided on Phillips Edison, with half rating it a buy and the other half a hold, the average price target suggests about 6% upside potential, reflecting cautious optimism about its future performance.
See More
Phillips Edison & Company Q4 2025 Earnings Call Highlights
- Strong Financial Performance: In Q4 2025, Phillips Edison reported a 7.2% increase in NAREIT FFO per share and a 7% rise in core FFO per share, alongside a 3.8% growth in same-center NOI, reflecting robust market performance and profitability.
- High Demand Leasing Activity: The company executed 1,026 leases totaling approximately 6 million square feet in 2025, ending the year with a portfolio occupancy of 97.3%, including a strong anchor occupancy of 98.7%, indicating strong demand for necessity-based retail.
- Liquidity and Acquisition Plans: As of December 31, 2025, the company had approximately $925 million in liquidity to support its acquisition plans of $400 million to $500 million in 2026, demonstrating flexibility in capital allocation and strategic foresight.
- Optimistic Future Outlook: The company anticipates a 5.5% increase in NAREIT FFO per share for 2026, with same-center NOI growth projected between 3% and 4%, indicating management's confidence in maintaining a competitive edge in the necessity retail sector.
See More
Phillips Edison Q4 Earnings Exceed Expectations
- Strong Financial Performance: Phillips Edison (PECO) reported a Q4 FFO of $0.66, beating expectations by $0.01, indicating robust profitability in the current market environment.
- Significant Revenue Growth: The company achieved $187.9 million in revenue for Q4, an 8.6% year-over-year increase, surpassing market expectations by $5.85 million, reflecting solid growth and sustained demand in the retail sector.
- 2026 Guidance Outlook: PECO projects a net income per share of $0.74 to $0.77 for 2026, with Nareit FFO per share expected to be between $2.65 and $2.71, showcasing the company's optimistic outlook based on current market conditions.
- Investment and Expense Planning: The company plans acquisitions ranging from $400,000 to $500,000 in 2026, with interest expenses projected at $117,000 to $127,000 and G&A expenses at $49,000 to $53,000, indicating a strategic focus on business expansion and cost control.
See More
Phillips Edison to Announce Q4 Earnings on February 5
- Earnings Announcement: Phillips Edison (PECO) is set to release its Q4 earnings after market close on February 5, with consensus EPS estimates at $0.15 and revenue expectations at $182.05 million, reflecting a 5.2% year-over-year growth.
- Earnings Estimate Changes: Over the last three months, EPS estimates have seen one upward revision with no downward adjustments, while revenue estimates have experienced two upward revisions and three downward adjustments, indicating mixed market sentiment regarding the company's future performance.
- Long-Term Growth Strategy: Phillips Edison focuses on grocery-anchored retail properties and has discussed its long-term growth strategy and performance, suggesting the company aims for sustained development in a stable market environment.
- Rating Upgrade Impact: The recent upgrade in Phillips Edison’s rating highlights market recognition of its defensive investment characteristics, potentially attracting more investors seeking stable returns.
See More
Phillips Edison (PECO) Announces 2025 Tax Reporting with $0.1025 Per Share Distribution
- Dividend Distribution Info: PECO announced a total distribution of $0.1025 per share for 2025, with ordinary dividends at $0.084002, reflecting the company's ongoing cash flow strength and commitment to shareholder returns.
- Capital Gain Distribution: PECO reported no capital gain distributions for 2025, indicating a stable tax position without additional capital gains tax liabilities, which enhances investor confidence.
- Operational Scale: As of September 30, 2025, PECO manages 328 shopping centers encompassing 34 million square feet, demonstrating its strong presence and operational capacity in the U.S. market.
- Market Positioning: PECO focuses on delivering grocery-anchored shopping experiences, partnering with major retailers like Kroger and Publix, ensuring its competitive edge and customer base in the retail sector.
See More
Investment Opportunities in Monthly Dividend Stocks
- Stability of REITs: Realty Income's monthly dividend of $0.27 per share marks its 667th consecutive month of payouts, and it has increased dividends annually since 1994, demonstrating strong stability and reliable cash flow in the commercial real estate sector.
- Advantages of BDCs: Main Street Capital pays a monthly dividend of $0.26 and has increased its payouts for 18 consecutive years, focusing on lower middle-market companies with revenues between $10 million and $150 million, showcasing its unique competitive edge in providing debt and equity solutions.
- Retail REIT Market Strategy: Phillips Edison & Company offers a monthly dividend of $0.11 with a high occupancy rate of 97.3%, focusing on neighborhood shopping centers and successfully attracting 5,500 tenants, reflecting its strong adaptability in the retail market.
- Long-Term Return Potential: Over the past decade, Realty Income and Main Street Capital have achieved annualized returns of 6.4% and 8.3%, respectively, while Phillips Edison averages a 7% annual return, indicating their long-term growth potential in dividend investment strategies.
See More
Real Estate Sector Holds Steady Amid Market Turmoil; Analyst Highlights Two Stocks
- Real Estate Resilience: Despite overall market declines, the real estate sector posted a 1.5% gain last week, demonstrating resilience amid risk sell-offs, which may attract more investor interest.
- Analyst Stock Favorability: Wolfe Research's technical analyst Rob Ginsberg highlighted Phillips Edison & Co.'s bullish chart pattern, noting its current dividend yield of approximately 3.3%, appealing to income-seeking investors.
- Earnings Beat Expectations: Phillips Edison recently reported fourth-quarter core funds from operations (FFO) of 66 cents per share on revenue of $187.6 million, exceeding analyst expectations and indicating strong operational performance.
- Market Outlook Divergence: While analysts are divided on Phillips Edison, with half rating it a buy and the other half a hold, the average price target suggests about 6% upside potential, reflecting cautious optimism about its future performance.
See More
Phillips Edison & Company Q4 2025 Earnings Call Highlights
- Strong Financial Performance: In Q4 2025, Phillips Edison reported a 7.2% increase in NAREIT FFO per share and a 7% rise in core FFO per share, alongside a 3.8% growth in same-center NOI, reflecting robust market performance and profitability.
- High Demand Leasing Activity: The company executed 1,026 leases totaling approximately 6 million square feet in 2025, ending the year with a portfolio occupancy of 97.3%, including a strong anchor occupancy of 98.7%, indicating strong demand for necessity-based retail.
- Liquidity and Acquisition Plans: As of December 31, 2025, the company had approximately $925 million in liquidity to support its acquisition plans of $400 million to $500 million in 2026, demonstrating flexibility in capital allocation and strategic foresight.
- Optimistic Future Outlook: The company anticipates a 5.5% increase in NAREIT FFO per share for 2026, with same-center NOI growth projected between 3% and 4%, indicating management's confidence in maintaining a competitive edge in the necessity retail sector.
See More
Phillips Edison Q4 Earnings Exceed Expectations
- Strong Financial Performance: Phillips Edison (PECO) reported a Q4 FFO of $0.66, beating expectations by $0.01, indicating robust profitability in the current market environment.
- Significant Revenue Growth: The company achieved $187.9 million in revenue for Q4, an 8.6% year-over-year increase, surpassing market expectations by $5.85 million, reflecting solid growth and sustained demand in the retail sector.
- 2026 Guidance Outlook: PECO projects a net income per share of $0.74 to $0.77 for 2026, with Nareit FFO per share expected to be between $2.65 and $2.71, showcasing the company's optimistic outlook based on current market conditions.
- Investment and Expense Planning: The company plans acquisitions ranging from $400,000 to $500,000 in 2026, with interest expenses projected at $117,000 to $127,000 and G&A expenses at $49,000 to $53,000, indicating a strategic focus on business expansion and cost control.
See More
Phillips Edison to Announce Q4 Earnings on February 5
- Earnings Announcement: Phillips Edison (PECO) is set to release its Q4 earnings after market close on February 5, with consensus EPS estimates at $0.15 and revenue expectations at $182.05 million, reflecting a 5.2% year-over-year growth.
- Earnings Estimate Changes: Over the last three months, EPS estimates have seen one upward revision with no downward adjustments, while revenue estimates have experienced two upward revisions and three downward adjustments, indicating mixed market sentiment regarding the company's future performance.
- Long-Term Growth Strategy: Phillips Edison focuses on grocery-anchored retail properties and has discussed its long-term growth strategy and performance, suggesting the company aims for sustained development in a stable market environment.
- Rating Upgrade Impact: The recent upgrade in Phillips Edison’s rating highlights market recognition of its defensive investment characteristics, potentially attracting more investors seeking stable returns.
See More
Phillips Edison (PECO) Announces 2025 Tax Reporting with $0.1025 Per Share Distribution
- Dividend Distribution Info: PECO announced a total distribution of $0.1025 per share for 2025, with ordinary dividends at $0.084002, reflecting the company's ongoing cash flow strength and commitment to shareholder returns.
- Capital Gain Distribution: PECO reported no capital gain distributions for 2025, indicating a stable tax position without additional capital gains tax liabilities, which enhances investor confidence.
- Operational Scale: As of September 30, 2025, PECO manages 328 shopping centers encompassing 34 million square feet, demonstrating its strong presence and operational capacity in the U.S. market.
- Market Positioning: PECO focuses on delivering grocery-anchored shopping experiences, partnering with major retailers like Kroger and Publix, ensuring its competitive edge and customer base in the retail sector.
See More
