What is the market's earnings forecast for Essential Properties next quarter?

Did Essential Properties beat or miss consensus estimates last quarter?

What is Essential Properties's gross profit margin?

What factors drove the changes in Essential Properties's revenue and profit?

What does Essential Properties do and what are its main business segments?

What is the revenue and EPS growth rate for Essential Properties year over year?

What guidance did Essential Properties's management provide for the next earnings period?

What were the key takeaways from Essential Properties's earnings call?

- **Record Investment Performance**: $370M Q3 investments at 8% cash yield, driving AFFO up 12% YoY. 
- **Portfolio Strength**: 1.6% rent growth, 3.6x coverage, and 40bps watch list reduction. 
- **2026 Outlook**: $1.98-$2.04 AFFO target (+6-8%), supported by $1-1.4B investments. 
- **Capital Discipline**: 3.8x leverage, $1.4B liquidity, and 63% dividend payout ratio. 
- **Strategic Growth**: Industrial assets expanded to 3.5% of ABR with no concentration risk.

**【CEO Summary Section】**
- **Revenue and Investment Growth**: Q3 2025 investments reached $370 million, with 70% sourced from repeat tenants. Weighted average initial cash yield was 8%, and GAAP yield hit 10%, the highest on record. 
- **Portfolio Performance**: Same-store rent growth of 1.6%, up from 1.4% Q2. Rent coverage improved to 3.6x, with 120bps decline in ABR under 1x coverage. Tenant credit watch list reduced by 40bps. 
- **Guidance Updates**: AFFO per share raised to $1.87-$1.89 (prev $1.84-$1.86). 2026 AFFO guidance set at $1.98-$2.04 (+6-8%), with $1-1.4B investment target. 
- **Capital Allocation**: $1.4B liquidity, 3.8x leverage. $400M 10-year bond issued at 5.4% coupon to extend debt maturity. 

**【CFO Financial Commentary】**
- **Financial Results**: Q3 AFFO of $0.48 (+12% YoY), total AFFO $96.2M (+24% YoY). G&A expenses $10.2M, 6.7% of revenue (vs 5.1% YoY). Dividend payout ratio 63%. 
- **Balance Sheet**: Pro forma net debt/EBITDA 3.8x. $140M retained free cash flow annually. $521M unsettled forward equity to support 2026 investments. 
- **Cost Efficiency**: Cash G&A guidance $31-35M, down 4.7% of revenue (vs 5.1% YoY). 

**【Q&A Key Highlights】**
- **Cap Rate Compression**: Expect mid- to high 7% pipeline cap rates, driven by stable interest rates. 10-year Treasury decline from 4.5% to 4.0%. 
- **Competition Response**: 35% of deals won through reliability and execution, not price. 2026 investment pipeline remains strong. 
- **Credit Management**: Credit loss experience 30bps vs budget, no material impairments. 7 assets sold ($11.5M) at 6.6% yield to manage risk. 
- **Industrial Expansion**: 18.6-year lease terms, 2.3% escalations. Industrial assets now 3.5% of ABR, with no concentration risk (top 20 tenants 27.6% of ABR).

Essential Properties Realty Trust (EPRT)-23 Oct 25-2025 Q3 Earnings call transcript

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