JPMorgan's REIT Reshuffle: Ventas Stock Climbs, Cold Storage Giants Slip

JPMorgan analyst Michael W. Mueller announced several ratings changes during the firm’s quarterly CRE update webinar.

The analyst upgraded Ventas Inc. VTR from Neutral to Overweight and raised the firm’s December 2025 price target to $72 from $70.

Mueller cited robust internal and external growth, including double-digit same-store net operating income gains and a steady pace of acquisitions, as key drivers supporting a positive outlook for normalized FFO per share growth.

The analyst noted that compared to peer Welltower, Ventas appears more attractively valued, especially on an implied cap rate basis, even though its growth potential may be slightly lower.

While external growth has slowed across the broader REIT sector, Mueller said Ventas’s continued success positions it as a relative outperformer.

The price target hike reflects updates to the analyst’s financial model, which now incorporates improved growth visibility. The revised target is based on a dividend discount model assuming a 5.25% long-term growth rate, a 95% AFFO payout ratio, and a high-8% discount rate.

Mueller downgraded Americold Realty Trust Inc. COLD from Overweight to Neutral and cut the firm’s December 2025 price target to $21 from $24.

The analyst cited weaker throughput volumes and lower occupancy rates as key headwinds limiting near-term performance. Despite trading at significantly lower EBITDA multiples than last year — offering long-term revaluation potential — investor sentiment remains focused on current operational pressures.

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The reduced price target reflects lower earnings estimates and the application of a higher 11.5% discount rate in the firm’s DCF model, underscoring increased uncertainty and tempered growth expectations. A recovery is projected in 2026, contingent on improved macroeconomic conditions.

Mueller downgraded Federal Realty Investment Trust FRT to Neutral from Overweight and set a December 2025 price target of $108.

The analyst cited a reduced focus on development and redevelopment projects — currently key growth drivers for several other retail REITs — as a reason for the downgrade.

He also noted that investors are taking a cautious stance toward FRT’s strategy of entering newer markets, such as Kansas City, by divesting high-quality assets. This pivot may take time to yield visible operational benefits.

Given the current macroeconomic backdrop, sentiment has shifted in favor of grocery-anchored and neighborhood-centric REITs, which are viewed as more defensive compared to FRT’s portfolio.

JPMorgan’s $108 target is based on a discounted cash flow model incorporating a 4.4% long-term AFFO growth rate, a 95% payout ratio, and a high-8% discount rate.

Mueller downgraded Lineage Inc. LINE to Underweight from Neutral and lowered the firm’s December 2025 price target to $50 from $55.

The analyst noted a broader preference for other REIT sectors and stocks, despite the long-term merits of the Lineage platform.

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He pointed out that the cold storage segment is currently facing lower throughput volumes, which are creating occupancy and pricing headwinds likely to impact near-term performance.

The analyst also flagged that Lineage’s 2025 AFFO per share outlook falls below the low end of management guidance, while growth in 2026 is expected to be constrained by the roll-off of interest rate hedges.

The revised $50 price target is based on a dividend discount model using a 5.3% long-term growth rate, 95% AFFO payout ratio and an approximately 10.75% discount rate.

Price Actions: At publication on Monday, VTR shares were trading higher by 1.63 at $63.47, COLD was up 0.12% at $16.81, FRT was down 0.13% at $95.28, and LINE was up by 0.69% at $45.07.

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