Bank of America has revised its view on several retail-focused real estate investment trusts following a broadly solid round of fourth-quarter earnings. With eight of 11 firms in the coverage set having reported, the sector showed resilience, with the majority of companies meeting or surpassing analyst expectations.
Analysts at the bank highlighted two themes from the quarter: unusually strong leasing momentum during 2025 and tenant credit performance that came in better than anticipated. Based on those results, the team expects risk exposure to be manageable going into 2026.
Company-level moves
Acadia Realty - Bank of America lifted its price objective to $24 from $23 and kept a Buy rating in place. The firm applies a 5.7% cap rate to its forward net operating income estimates, and values the stock at a modest 2.5% discount to forward net asset value.
Brixmor - After its Q4 report, BofA raised the price target to $32 from $30 while maintaining a Buy recommendation. The bank now uses a 6.7% cap rate on forward NOI, down slightly from 6.8%, and expects the shares to trade in line with forward NAV.
InvenTrust - Following quarterly results, the price objective was increased to $35 from $34 and the Buy rating was reaffirmed. Analysts apply a 6.5% cap rate (up from 6.4%) to forward NOI and project the stock will trade in line with forward NAV.
Phillips Edison - BofA pushed its price target to $45 from $43 after Q4 results and left its Buy rating unchanged. The bank applies a 6.4% cap rate to forward NOI estimates and expects Phillips Edison to trade in line with forward NAV.
Regency - The price objective on Regency was raised to $86 from $84, with the Buy rating reiterated. BofA uses a 5.5% cap rate on forward NOI and projects the shares to trade in line with forward NAV.
Simon Property Group - Following Q4, BofA increased its price objective to $219 from $208 and maintained a Buy rating. The firm now assumes a 5% premium to forward NAV, up from 0%, citing Simon Property's platform advantages, distinct growth levers, and a stronger balance sheet. A 6.0% cap rate is applied to forward NOI estimates.
Sector outlook
Analysts expect another year of solid core results for strip center REITs, driven by record leasing activity and a string of accretive acquisitions that are contributing to growth across the sector. The combination of leasing momentum and improved tenant credit underpinned the upward adjustments to price targets while analysts kept a constructive stance by maintaining Buy recommendations on the names reviewed.
What this means for investors
Bank of America's adjustments reflect confidence in near-term fundamentals for the covered retail REITs, with valuation assumptions explicitly tied to applied cap rates and forward NOI estimates. The firm signals relatively contained downside risk for 2026 based on the recent earnings cadence and leasing trends.