Jefferies raises Agree Realty stock price target to $90 on strong balance sheet

Jefferies raised its price target on Agree Realty (ADC) to $90 from $89, maintaining a Buy rating, citing the REIT's sector-leading balance sheet, growth discipline, and recent A- credit rating from Fitch. This follows the company's Q2 2025 results, which reported a revenue beat of $175.53 million despite a slight EPS miss. UBS also increased its price target to $82, as Agree Realty raised its 2025 Adjusted Funds From Operations (AFFO) guidance and acquisition midpoint, signaling continued analyst confidence in the company's strategic adjustments and future performance.

Analysis

Agree Realty (ADC) is experiencing strong positive sentiment from sell-side analysts, with both Jefferies and UBS upgrading their price targets to $90.00 and $82.00, respectively, while maintaining 'Buy' ratings. The core driver for this optimism, particularly from Jefferies, is the REIT's superior financial position, evidenced by a newly awarded A- credit rating from Fitch—a distinction held by only 13 publicly listed U.S. REITs. This high-quality balance sheet, combined with disciplined growth and a favorable cost of capital, is expected to support an expansion of its 17x AFFO multiple. The analyst confidence is further substantiated by the company's own revised forward-looking statements, including an increased 2025 AFFO guidance midpoint and a $100 million higher acquisition target. This positive outlook overshadows the mixed second-quarter 2025 results, where a revenue of $175.53 million beat forecasts, but earnings per share of $0.43 slightly missed expectations. Despite the minor earnings miss, the company's robust 13.16% revenue growth over the last twelve months and a 4.25% dividend yield present a compelling fundamental picture.

Key Decisions for Investors

• Given the dual analyst price target upgrades and positive revisions to company guidance, investors may view the current price of $72.27 as an attractive entry point with significant potential upside to the new targets of $82 and $90.
• Investors should monitor the execution of the increased $100 million acquisition target and the achievement of the updated AFFO guidance, as these are the key catalysts underpinning the current bullish thesis.
• While the overall outlook is strong, the slight Q2 EPS miss warrants attention, and future earnings reports should be scrutinized to ensure profitability scales effectively with the company's aggressive growth and acquisition strategy.
• For income-oriented portfolios, the 4.25% dividend yield, backed by a new A- credit rating and strong operational fundamentals, positions Agree Realty as a high-quality consideration in the REIT sector.