Why Cousins Properties Stock Could Be a Smart Long-Term Buy

Cousins Properties (CUZ) reported Q3 2025 FFO per share of 69 cents, meeting consensus and up 3% year-over-year, supported by robust leasing activity totaling 1.4 million square feet year-to-date, including 490,000 square feet of new deals, despite headwinds from lower occupancy and increased interest expenses. The office REIT subsequently raised its 2025 FFO outlook to $2.83 per share, reflecting confidence in its strategy of investing in Class A office assets within high-growth Sun Belt markets, supported by ongoing capital recycling and a strong balance sheet, even as its shares have recently lagged the broader industry.

Analysis

Cousins Properties (CUZ) reported Q3 2025 FFO per share of $0.69, aligning with consensus and marking a 3% year-over-year increase. This was driven by robust leasing activity, with 1.4 million square feet leased year-to-date, including nearly 490,000 square feet of new deals. Despite lower weighted average occupancy and higher interest expenses, CUZ raised its 2025 FFO per-share outlook, now at $2.83 per the Zacks Consensus Estimate.

The company's strategic focus on high-quality Class A office assets within high-growth Sun Belt markets continues to drive demand, evidenced by a 4.2% increase in second-generation net rent per square foot on a cash basis in Q3 2025. CUZ's diversified tenant base and active capital recycling, such as the $218.0 million acquisition of The Link in Dallas, enhance portfolio quality and long-term growth prospects, leveraging favorable regional trends.

Cousins Properties maintains a robust balance sheet, exiting Q3 2025 with $467.5 million in cash and $916.3 million available on its credit facility, providing ample liquidity for growth. While analysts hold a positive outlook with a Zacks Rank #2 (Buy), the stock has underperformed, declining 5.8% over the past three months against an industry growth of 3.5%. This divergence suggests a potential market mispricing relative to the company's fundamental strengths.

Key Decisions for Investors

• Investors should consider Cousins Properties (CUZ) for long-term growth given its strong Sun Belt market positioning, healthy leasing activity, and raised FFO guidance.
• Monitor occupancy trends and interest rate movements, as these remain potential headwinds despite the company's robust balance sheet.
• Evaluate the recent stock underperformance against industry peers as a potential entry point, considering the positive analyst sentiment and fundamental strengths.