Hudson Pacific Properties (NYSE:HPP) has received a significant downgrade from analysts at Zacks Research, who have changed their rating from “hold” to “strong sell.” This decision, announced on November 24, 2023, reflects growing concerns over the company’s financial performance and market conditions.
Several other equity analysts have also adjusted their ratings and price targets for Hudson Pacific Properties. On November 24, Citigroup lowered its price objective from $20.30 to $13.30 while maintaining a “neutral” rating. Similarly, Cantor Fitzgerald revised its target from $24.50 to $21.00, categorizing the company as “overweight” in a report released on November 6.
In contrast, BTIG Research set a price target of $26.00 and rated the stock as a “buy.” The Goldman Sachs Group, on December 19, assigned a price objective of $16.50 with a “neutral” rating, while Piper Sandler adjusted its target from $21.00 to $17.50, also rating the stock as “neutral.”
Currently, five analysts have given Hudson Pacific a buy rating, seven have assigned a hold rating, and three have issued sell ratings. The average recommendation stands at “hold,” with an average price target of $18.46, according to MarketBeat data.
Quarterly Earnings and Institutional Investments
Hudson Pacific Properties reported its latest quarterly earnings on November 5, 2023. The real estate investment trust announced earnings per share (EPS) of $0.04, surpassing analysts’ expectations of $0.02 by $0.02. Despite this positive earnings surprise, the company recorded a negative net margin of 59.61% and a return on equity of -16.24%. Revenue for the quarter reached $186.62 million, slightly above the consensus estimate of $186.05 million. Looking ahead, Hudson Pacific has set its guidance for Q4 2025 EPS between $0.010 and $0.050.
Institutional investors are showing interest in Hudson Pacific, with multiple firms recently modifying their holdings. Abel Hall LLC and Ethic Inc. both acquired new stakes valued at $28,000 during the second and third quarters, respectively. Evergreen Capital Management LLC and Orion Portfolio Solutions LLC also entered new positions, contributing to an overall institutional ownership of 97.58% of the company’s stock.
Company Overview and Market Focus
Hudson Pacific Properties is a self-managed real estate investment trust specializing in the acquisition, development, and management of high-quality office and studio properties. Its portfolio covers strategic markets on the West Coast of the United States and key locations in Canada, catering to technology, media, and creative industries, as well as major film and television producers.
The company strategically targets markets with strong job growth and limited supply, including Los Angeles, Silicon Valley, San Diego, Seattle, and Vancouver, British Columbia. As both an owner and operator of traditional office spaces and specialized production facilities, Hudson Pacific aims to deliver stable income through long-term leases and targeted property enhancements.
The recent downgrade and evolving market conditions pose significant implications for Hudson Pacific Properties as it navigates a competitive landscape and seeks to optimize its portfolio for future growth.
