Home Properties Outlook Improves

Home Properties

continues to improve its outlook as Jefferies reiterates its Buy rating and revises estimates slightly lower to 2010, 2011, and 2012 FFO/share estimates to $3.08, $3.41, and $3.62, from $3.10, $3.34, and $3.54, respectively. Jefferies continues to rate HME as the best way to play offense and defense in its Apartment REIT coverage universe. HME's exposure to fast growing East Coast markets is a positive should the economic recovery accelerate. Risks to the target price include a slowdown in economic recovery in the U.S leading to unemployment rates remaining at elevated levels, prologed lease-up of development projects, acquisitions being more difficult/expensive to come by, and the inability to refinance $299M of debt maturing in 2011 at attractive interest rates. Jefferies has a price target of $60 and a Buy rating HMe is trading higher at $53.80