CoreSite Realty Earnings: Here’s Why Investors are Not Happy Now

CoreSite Realty Corporation (NYSE:COR) delivered a profit and met Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 4.3%.

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CoreSite Realty Corporation Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 13.89% to $0.41 in the quarter versus EPS of $0.36 in the year-earlier quarter.

Revenue: Rose 16.54% to $55.1 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: CoreSite Realty Corporation reported adjusted EPS income of $0.41 per share. By that measure, the company met the mean analyst estimate of $0.41. It missed the average revenue estimate of $56.32 million.

Quoting Management: Tom Ray, CoreSite’s Chief Executive Officer, commented, “Our first-quarter financial results reflect continuing momentum in growing our business. New and expansion data center sales volume of 42,800 square feet was 30% above our trailing 12-month average, excluding the 100,000 square-foot powered-shell build-to-suit signed in Q4-12. The GAAP rental rate on new and expansion data center sales in Q1-13 was $119 per square foot, which was below our trailing four-quarter mean, driven meaningfully by lower power density and geographic variations in the Q1-13 sales mix. Looking deeper, our Q1-13 sales also accomplished key operational goals. Specifically, we materially increased the number of customer commitments that we believe add strategic value to our platform. Further, we backfilled a significant component of recently vacated capacity and executed an anchor deployment on the newly opened third floor of our LA2 facility. Finally, we saw strong annualized interconnection growth, which we believe reflects early signs of what we target to be a more profitable sales mix.”

Key Stats (on next page)…

Revenue decreased 0.27% from $55.25 million in the previous quarter. EPS decreased 2.38% from $0.42 in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $0.41 to a profit $0.43. For the current year, the average estimate has moved up from a profit of $1.71 to a profit of $1.79 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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