Scotiabank Downgrades Camden Property Trust (CPT) to Sector Underperform

Scotiabank analyst Nicholas Yulico downgraded Camden Property Trust (NYSE: CPT) from Sector Perform to Sector Underperform with a price target of $95.00 (from $113.00).

The analyst comments "OUR TAKE: Negative. Today, we are downgrading both CPT and MAA to Sector Underperform from Sector Perform as we forecast a more challenging Sunbelt recovery. Based on our analysis of CoStar multifamily market data (plus historical population and migration data), we estimate it will take several years to absorb the significant overbuilding that has occurred in most Sunbelt markets. In our view, this will prevent a return to pre-COVID occupancy levels that would allow for better Sunbelt rent growth, resulting in CPT and MAA posting avg. annual -2%/+1% FFOPS growth in 2026/2027, trailing Multifamily peers (+1%/+2% ex-CPT/MAA) and the U.S. REIT sector (+6%/+7%). Given this more bearish outlook (and our below-Street 2027 estimates), we think both CPT/MAA should trade at the low end of historical P/FFOPS multiples relative to REITs and Multifamily Coastal-heavy peers AVB/EQR/ESS (where, in contrast, we see capacity for improving rent growth due to supply/demand dynamics). We lower our applied multiples for CPT/MAA from 16.0x to 14.0x 2027E FFOPS. ESS remains our preferred name in Multifamily based on high Northern CA exposure (leading US in current rent growth)."

For an analyst ratings summary and ratings history on Camden Property Trust click here. For more ratings news on Camden Property Trust click here.

Shares of Camden Property Trust closed at $105.35 yesterday.

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