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Research Alert: CFRA Upgrades Shares Of Avalonbay Communities, Inc. To Hold From Sell Rating

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CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

We raise our target price by $21 to $190, applying a forward P/FFO of 16.9x, just above the peer average and reflecting an M&A premium from the Equity Residential merger, which is expected to close in the second half of 2026. We keep FFO estimates at $11.25 in 2026 and $11.70 in 2027 on projected revenue of $3.12B and $3.2B, respectively. Earlier today, AVB and EQR announced an all-stock merger to gain scale and efficiencies as a larger company with a formidable balance sheet. AVB shareholders will receive 2.793 newly issued EQR shares for each AVB share, leading to pro forma ownership of 51.2% AVB shareholders and 48.8% EQR, approved by both boards of trustees. The initial operating savings are $125M and $175M gross operating synergies, and the merger is expected to be accretive to the standalone core FFO of both AVB and EQR. We think the broader opportunity is investing in an AI-led platform that supports broader capabilities and efficiencies.

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