Jefferies has raised its 12-month price target for COPT Defense Properties (CDP) to $37.00 from $34.00 while retaining a Buy rating on the stock. At the time of the update CDP was trading at $31.87, trading near its 52-week high of $32.67 and up roughly 14.64% year-to-date according to InvestingPro data.
The research note attributes the higher target to the company’s expectation of approximately $52 million per year in net operating income (NOI) from a slate of developments that are scheduled to phase into service from 2026 through 2029. Of that projected NOI, Jefferies identifies $48 million as being contractual in nature, with the remaining contribution expected to come from the lease-up of the 8500 Advanced Gateway project.
Jefferies also called out near-term occupancy dynamics tied to NBP 400. The building is due to be placed in service in the second quarter, a step that the firm expects will temporarily reduce overall occupancy by about 60 basis points until a full-building lease is realized in the fourth quarter of 2026.
Alongside that timing, COPT has set an explicit leasing objective for 2026 of 400,000 square feet of vacancy to be filled. The note frames those operational targets against a broader demand backdrop, noting a fiscal 2026 defense budget in excess of $950 billion and expectations for increases in 2027, which Jefferies says supports a multiyear demand runway for defense-oriented property owners.
Market metrics cited in the analysis include a price-to-earnings ratio of 23.78 and a dividend yield of 3.83%. InvestingPro data referenced in the research shows COPT has paid dividends for 34 consecutive years and assigns the company an overall financial health score of GOOD.
Recent corporate results provided additional support for the firmer outlook. In fourth-quarter 2025 results CDP reported earnings per share of $0.33, meeting expectations, while revenue came in at $197.36 million versus $179.51 million expected - a 9.94% upside to consensus. For the full year the company recorded funds from operations (FFO) of $2.72 per share, beating the guidance the company had set a year earlier by $0.06 per share. COPT’s guidance for 2026, a range of $2.71 to $2.79 per share, modestly exceeded prevailing street estimates.
Following the quarterly release, Cantor Fitzgerald also raised its price target on COPT from $33 to $37 and kept an Overweight rating, citing the company’s robust quarterly performance as a driver of its reassessment.
Key points
- Jefferies raised its price target on CDP to $37 from $34 and reaffirmed a Buy rating.
- Company expects about $52 million per year of development-driven NOI from 2026-2029, with most being contractual.
- Recent earnings beat revenue expectations and full-year FFO exceeded prior guidance; Cantor Fitzgerald also raised its target to $37.
Risks and uncertainties
- NBP 400 coming into service in Q2 is expected to reduce occupancy by roughly 60 basis points until a full-building lease is secured - a near-term occupancy headwind for the REIT sector.
- COPT has set a 400,000 square foot leasing target for 2026, which represents execution risk against leasing and market absorption in that year.