UPDATE: Imperial Capital Initiates Coverage of Equity Lifestyle Properties with Outperform Rating, $86 PT on Attractive Residential Options

In a report published Wednesday, Imperial Capital analyst David Harris initiated coverage on Equity Lifestyle Properties ELS with an Outperform rating and $86.00 price target. In the report, Harris noted, “We are initiating coverage of ELS common stock with an Outperform rating and a one-year price target of $86. Achieving our target, together with receipt of the current dividend, would generate a potential 10% total return over 12 months, which is at the upper end of our sector expectations. Chaired by legendary investor, Samuel Zell, Equity Lifestyles is the largest public owner of manufactured home (MH) and RV (recreational vehicles) sites and campgrounds. MH communities, which contribute about 70% of ELS's property revenues, are one of the most stable of all property types in our view. New supply is limited and demand is driven by the need for shelter. MH represents an attractive residential option to an aging population and to some low-mid income families. The stabilization/improvement of home prices in many markets across the country should help facilitate the sales of family homes and move to sunbelt, MH communities. ELS's Recreational Vehicle (RV) business has similar fundamental characteristics to MH. We believe the company has the capacity to increase its dividend at a rate in excess of the growth we expect from the sector.” Equity Lifestyle Properties closed on Tuesday at $80.14.