Vici Properties (VICI -1.44%), a real estate investment trust (REIT) specializing in gaming and experiential assets, released third-quarter results on Thursday, Oct. 31, that topped analyst consensus estimates on both top and bottom lines. The company reported an earnings per share (EPS) of $0.70 that grew 27% year over year. Total revenue for the quarter was $964.7 million, up 6.7% year over year.
This outperformance was largely due to effective lease portfolio management and strategic capital deployment. Overall, Vici showcased robust financial results for the quarter.
| Metric | Q3 2024 | Analysts Estimate | Q3 2023 | Change (YOY) |
|---|---|---|---|---|
| EPS | $0.70 | $0.67 | $0.55 | 27% |
| Revenue | $964.7 million | $953.2 million | $904.3 million | 6.7% |
| Net income | $732.9 million | --- | $556.3 million | 31.7% |
| AFFO | $593.9 million | --- | $547.6 million | 8.4% |
Source: Vici Properties. Note: Analyst consensus estimates for the quarter provided by FactSet. YOY = Year over year. AFFO = Adjusted funds from operations.
Company Overview & Business Focus
Vici Properties manages a real estate portfolio of premier gaming, hospitality, and entertainment properties. The company thrives on long-term triple-net leases, which ensure stable cash flows by shifting property operational expenses to tenants. Vici's portfolio, featuring iconic resort and casino properties in Las Vegas, positions it strategically for consistent performance.
Recent initiatives emphasize asset acquisition and strategic investments. Its Partner Property Growth Fund nurtures new ventures, while right-of-first refusal agreements leverage growth opportunities. Financial stability is bolstered by these strategic moves, contributing to Vici's robust business mode
Quarterly Performance Highlights
Vici Properties demonstrated significant Q3 growth in key financial metrics, notably a nearly 32% increase in net income attributed to common stockholders, reaching $732.9 million. Total revenue rose 6.7% year over year to $964.7 million, driven by long-term lease commitments and includes non-cash leasing adjustments of $135.9 million. These results signal strong alignment with strategic goals.
Adjusted funds from operations, a critical metric for REITs, increased by 8.4% from the previous year, showcasing enhanced cash generation. The quarterly dividend grew 4.2% year over year to $0.4325 per share, highlighting Vici's commitment to returning value to shareholders.
Important one-time events included a strategic capital deployment of $230 million through Partner Property Growth Fund agreements. New investments in key locations backed Vici’s long-term revenue growth.
The company’s strong lease structure, anchored by its 100% occupancy across a geographically diversified portfolio, has proven crucial. However, with total debt standing at around $17.1 billion, managing interest exposures remains a focus amid varying economic conditions.
Outlook
Looking ahead, Vici Properties maintains a positive outlook, raising its full-year AFFO guidance to $2.36 billion - $2.37 billion. This upward revision indicates confidence in the company's ongoing operational strength and strategic initiatives. Management's focus on geographic diversification is key as it navigates potential economic headwinds and interest rate fluctuations.
Investors should watch how Vici addresses its debt management while maximizing tenant relations. The company’s ability to capitalize on strategic opportunities, such as non-gaming facilities, remains an important area for potential growth and diversification.
