Analyst John Kim of BMO Capital maintained a Hold rating on JBG Smith Properties (JBGS – Research Report), retaining the price target of $18.00.
John Kim has given his Hold rating due to a combination of factors surrounding JBG Smith Properties’ current positioning and future prospects. The company has faced its share of challenges, notably the pause on Amazon HQ2’s development and the cancellation with Monumental Sports. Despite these setbacks, JBG Smith has made strides in its strategic shift to focus predominantly on multifamily properties and office space within National Landing. The company’s developments, The Grace and Reva, have shown impressive leasing activity, and the firm’s repositioning of National Landing as a hub for defense-tech is promising given its proximity to important centers like the Pentagon and the VA Tech Innovation Center.
While JBG Smith’s stock is considered undervalued, John Kim anticipates that significant growth in earnings and tangible progress on Amazon HQ2 would be essential to close the gap between the stock’s price and its net asset value (NAV). The defense sector’s robust leasing activity, which comprises a significant portion of the company’s leasing, supports JBGS’s strategic realignment. On the multifamily front, JBG Smith boasts a strong presence in National Landing, with Class A rents surpassing Class B by a considerable margin, indicating a potential for high revenue generation. However, until these positive factors translate into stronger financial performance, a Hold rating reflects a cautious but watchful approach.
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JBG Smith Properties (JBGS) Company Description:
JBG SMITH Properties is a real estate investment trust. It owns, operates, invests and develops assets on urban infill submarkets. It operates through following segments: Office, Multifamily and Third-Party Real Estate Services. The company was founded on October 27, 2016 and is headquartered in Chevy Chase, MD.
