VICI Properties Inc. VICI recently announced that it has secured an issuer credit rating upgrade to ‘Baa3’ from ‘Ba1’, with a stable outlook from Moody’s Investors Service, Inc. This is encouraging because, with investment-grade credit ratings, VICI can enjoy better accessibility to capital at favorable costs and opt for value-accretive investments.

This experiential REIT’s geographically diverse portfolio, consistent operating cash flows, sound liquidity position and strategic financial decisions drove the upward revision in the rating outlook by the rating agency.

As per David Kieske, CFO of VICI Properties, “We have used each transformational transaction along the way to improve our balance sheet and to best position ourselves for credit rating improvements.”

Shares of this Zacks Rank #3 (Hold) company have declined 2.2% over the past month, outperforming the industry's fall of 3.0%.

Image Source: Zacks Investment Research

VICI Properties owns a geographically diverse portfolio, which includes a mix of gaming, hospitality and entertainment assets located across the United States and Canada. It enjoys ownership of three of the most iconic entertainment facilities on the Las Vegas Strip, namely Caesars Palace Las Vegas, MGM Grand and the Venetian Resort Las Vegas.

The company stands to gain from its strong partnerships with top-tier experiential operators. The long-term triple-net leases with these tenants are likely to contribute to stable revenue generation, supporting its top-line growth.

Last October, VICI reported quarterly funds from operations (FFO) of 57 cents per share, beating the Zacks Consensus Estimate of 56 cents and the year-ago tally of 54 cents. Results reflected higher-than-anticipated revenues driven by higher same-store rentals. Total revenues increased by 6.7% year over year to $964.7 million.

As of Sept. 30, 2024, VICI had around $3.3 billion in liquidity, comprising $355.7 million in cash and cash equivalents, 630.2 million of estimated forward sale equity proceeds and around $2.3 billion of availability under its revolving credit facility. With its sound liquidity position, VICI is anticipated to sail efficiently through any unexpected negative externalities in the future and bank on growth opportunities.

Stocks to Consider

Some better-ranked stocks from the broader REIT sector are Cousins Properties CUZ and Welltower WELL, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Cousins Properties’ 2024 FFO per share stands at $2.68, which indicates an increase of 2.3% from the year-ago reported figure.