CTO Realty Group (CTO) PT Lowered to $21 at Lucid Capital Markets

Lucid Capital Markets analyst Craig Kucera lowered the price target on CTO Realty Group (NYSE: CTO) to $21.00 (from $23.00) while maintaining a Buy rating.

The analyst comments "We are lowering our price target on Buy-rated CTO Realty Growth (CTO) post 1Q25 results given a reduction to our 2025E AFFO and NAV estimate as well as multiple compression among retail REITs. CTO made solid progress in leasing again in 1Q25 while occupancy improved sequentially; however, the anticipated pace of ABR recognition within its signednot-open pool of assets slowed from 4Q24, leading us to reduce our 2025E AFFO from $1.98 to $1.95 vs. a reiterated guidance range of $1.93-$1.98. However, we are raising our 2026E AFFO from $2.23 to $2.28 as we anticipate occupancy to improve more rapidly in 2026 as CTO re-tenants a small number of assets at a 40%-60% increase to prior rents (namely assets formerly tenanted by retail concepts that filed for bankruptcy in 2H24). Our $21 price target represents 84% of our $24.90 NAV estimate and is 11x 2025E AFFO, vs. CTO’s retail REIT peers trading at 85% of NAV and 17x 2025E AFFO and <$2.5B market cap retail REIT peers trading at 16x."

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