KeyBanc has raised its price target on Terreno Realty Corp (NYSE:TRNO) to $72.00 from $68.00 and maintained an Overweight rating on the industrial-focused REIT. The firm framed the increase as a response to what it characterized as "favorable" fourth-quarter 2025 performance across the company’s operations.
The new $72.00 target aligns closely with InvestingPro’s Fair Value assessment, which indicates Terreno is undervalued at its then-current share price of $66.10. The stock was trading near its 52-week high of $69.20 at the time of the report.
In its analysis, KeyBanc pointed to several valuation and operational metrics supporting a positive view. Terreno’s reported price-to-earnings ratio of 16.64 and a notably low price/earnings-to-growth (PEG) ratio of 0.17 were cited as underpinning the bank’s constructive stance on the company’s growth prospects.
Operationally, KeyBanc highlighted improving leasing demand and rental rates that have stabilized across most of Terreno’s markets. The firm said growth is positioned to accelerate in the second half of 2026, noting that these leasing trends are contributing to a more favorable outlook for the REIT.
Balance-sheet strength figured prominently in KeyBanc’s view. The analyst emphasized Terreno’s "low-leverage balance sheet" as providing substantial financial flexibility, describing it as "an important advantage in the current macro environment." That financial posture, KeyBanc wrote, gives the company "ample capacity to remain opportunistic" on investment opportunities while the outlook for both investments and capital raising is strengthening.
Separately reported corporate actions and analyst moves were included in the update. Terreno secured a $200 million five-year unsecured term loan maturing on January 15, 2031. The interest on that facility will range from SOFR plus 1.15% to SOFR plus 1.65%, depending on leverage, and the company removed the prior 10 basis point SOFR credit spread adjustment premium on all credit facility borrowings.
On the portfolio front, Terreno acquired a 121,000-square-foot industrial property in Tukwila, Washington, for approximately $27.1 million. The purchase expands the company’s holdings in industrial real estate and was noted alongside the financing update.
Other analyst activity referenced in the same reporting included an upgrade from Baird, which moved Terreno from Neutral to Outperform while citing a favorable outlook for 2026 despite expectations of earnings volatility. The write-up also noted that KeyBanc has reiterated its Overweight rating with a $68.00 price target in a separate mention and that Citizens maintained its Market Outperform rating while calling out the company’s Miami expansion through its Countyline project.
Taken together, KeyBanc’s target increase, the five-year unsecured loan, and the Tukwila acquisition reflect a combination of operational momentum, conservative leverage, and active capital deployment by Terreno. The firm’s emphasis on rental-rate stabilization and rising leasing demand frames its expectation for accelerating growth in the latter half of 2026.
Key points
- KeyBanc raised its price target to $72.00 from $68.00 and kept an Overweight rating, pointing to "favorable" Q4 2025 results.
- Terreno’s valuation metrics cited by KeyBanc include a P/E of 16.64 and a PEG of 0.17.
- Company actions include a $200 million five-year unsecured term loan and the acquisition of a 121,000-square-foot industrial property in Tukwila, WA.
Risks and uncertainties
- Forecasted earnings volatility in 2026, as cited by Baird, could affect near-term performance and market perception.
- Market conditions that alter leasing demand or rental-rate trends could impede the anticipated acceleration of growth in the second half of 2026.
- Changes in leverage or capital markets could affect the cost and availability of future financing, relevant to the company’s investment capacity.