Friday was a good day to be an investor in commercial real estate company Kilroy Realty (NYSE: KRC). On news of an analyst upgrade, accompanied by a price-target bump, Kilroy’s stock zoomed to close the trading session more than 4% higher. That handily beat the performance of the benchmark S&P 500 index, which rose by slightly over 1%.
Well before market open, JPMorgan Chase‘s Anthony Paolone shifted his recommendation on Kilroy’s shares to overweight (i.e., buy) from neutral. The pundit also added $4 per share to his price target for a new level of $49. This is 21% higher than the stock’s most recent closing price.
Start Your Mornings Smarter! Wake up with Breakfast news in your inbox every market day. Sign Up For Free »
According to reports, Paolone wrote in his latest Kilroy research note that several of the company’s most crucial West Coast markets should rebound. The analyst acknowledged that it’s struggling with high vacancy rates. However, he’s bullish about the recent trend of tech businesses attempting to return their employees to in-person work at the office. California in particular is a center for this industry.
Paolone also feels that the company, which has hit all-time lows after the COVID-19 pandemic, is now cheap enough on valuations to warrant the new recommendation.
Personally, I wouldn’t be so enthusiastic about the prospects of commercial real estate businesses. Yes, there’s some movement back to traditional employee-in-office regimes, but it doesn’t feel like a trend that has serious momentum. Work-from-home and hybrid arrangements are here to stay, and they will continue to impact the market and, as a result, the fundamentals of companies like Kilroy.
Before you buy stock in Kilroy Realty, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Kilroy Realty wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $800,876!*
Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*.
*Stock Advisor returns as of December 16, 2024
JPMorgan Chase is an advertising partner of Motley Fool Money. Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends JPMorgan Chase. The Motley Fool has a disclosure policy.
—
Blog powered by G6
Disclaimer! A guest author has made this post. G6 has not checked the post. its content and attachments and under no circumstances will G6 be held responsible or liable in any way for any claims, damages, losses, expenses, costs or liabilities whatsoever (including, without limitation, any direct or indirect damages for loss of profits, business interruption or loss of information) resulting or arising directly or indirectly from your use of or inability to use this website or any websites linked to it, or from your reliance on the information and material on this website, even if the G6 has been advised of the possibility of such damages in advance.
For any inquiries, please contact [email protected]
