Want expert insights on REITs and BDCs? Join Colorado Wealth Management Fund’s email list—widely regarded as the top REIT analyst on Seeking Alpha. Stay ahead of the market with exclusive updates! [Sign Up Now]

Agree Realty (ADC) just posted its Q1 2025 results, and the report was respectable.

The company beat AFFO (Adjusted Funds From Operations) expectations by $0.02 per share, coming in at $1.06 versus a $1.04 consensus. Core FFO landed right on target at $1.04. The small beat isn’t shocking - ADC consistently reports slightly higher AFFO due to routine adjustments.

Management also nudged full-year AFFO guidance higher by a penny at the midpoint. The bar wasn’t exactly high to begin with, so this was more of a polite hop than a leap.

What really stands out is ADC’s continued use of its ATM (at-the-market) equity program. The company issued 2.4 million shares at an average of $75.33 - well above its consensus NAV (Net Asset Value) of ~$64. That’s a win for shareholders. Issuing equity at a premium helps fund acquisitions without diluting value on a per-share basis.

Speaking of acquisitions, ADC went on a bit of a spree: 46 properties at a 7.3% cap rate and a 13.4-year average lease term. That’s textbook ADC - long leases, solid tenants, and expansion funded smartly.

The only eyebrow-raiser? The valuation. Shares recently touched $79.12 - very close to a 5-year high. That’s a 23%+ premium to NAV, and possibly higher if current NAV estimates are a bit generous.

Bottom line: great company, great quarter, but the stock might’ve run a little too far ahead of the fundamentals. Nothing wrong with cheering for a winner but maybe wait for a better seat before jumping in.

Join The REIT Forum by Colorado Wealth Management Fund, trusted by over 60,000 investors for expert analysis on REITs, BDCs, and preferred shares. 

This article was compiled by my assistant. If there are any mistakes, blame him - I certainly will.