Jefferies Raises Agree Realty's Price Target To $47 Amid Increased Acquisition Volume

Agree Realty Corporation ADC raised its acquisition guidance for FY2016 from $175–$200 million to $250–$275 million earlier in May.

Jefferies’ George Hoglund maintains a Buy rating on the company, while raising the price target from $45 to $47.

“We are updating our model for an increase in our acquisition assumptions and the $110 million common equity raise earlier this month,” the analyst mentioned.

Robust Acquisition Volume

Following meetings with management at the ICSC conference, Hoglund mentioned that Agree Realty remains on track to deliver solid acquisition volume in 2016.

However, the timing of the company’s equity raise is expected to be dilutive in the near term, “as the majority of the pending acquisitions are expected to close in late 2Q16/3Q16, but are accretive to 2017.”

Agree Realty also issued 2.875 million common shares at $39.75 per share, leading to net proceeds of $109.6 million.

The FFO/share estimate for 2016 and 2017 have been raised from $2.54 to $2.52 and from $2.75 to $2.76, respectively.