Earnings call transcript: UMH Properties Q1 2026 earnings beat expectations

UMH Properties reported a strong start to 2026, with first-quarter earnings per share (EPS) of $0.03, significantly exceeding the forecast of $0.0067. This resulted in a remarkable 347.76% earnings surprise. The company also reported revenues of $65.84 million, surpassing expectations by 10.79%. Following the earnings announcement, UMH’s stock price rose by 2.06%, closing at $15.87, reflecting investor optimism.

UMH Properties demonstrated solid performance in Q1 2026, driven by strategic acquisitions and increased rental rates. The company’s rental and related income grew by 9% year-over-year, while home sales revenue increased by 6%. These gains were supported by a 7.6% increase in same-property revenue and a 7.1% growth in same-property net operating income (NOI).

UMH Properties reported an EPS of $0.03, significantly above the forecasted $0.0067, resulting in a 347.76% surprise. Revenue also exceeded expectations, coming in at $65.84 million against a forecast of $59.43 million, a 10.79% surprise. This performance highlights the company’s effective operational strategies and market positioning.

Following the earnings announcement, UMH’s stock price increased by 2.06%, closing at $15.87. The stock’s movement reflects investor confidence in the company’s robust financial performance and strategic growth initiatives. The stock remains within its 52-week range, with a high of $17.88 and a low of $13.93.

From a valuation perspective, the stock trades at a P/E ratio of 227, reflecting premium pricing. InvestingPro analysis indicates the stock is slightly overvalued relative to its Fair Value, placing it among stocks on the Most Overvalued watchlist. Investors seeking deeper insights can access 6 additional InvestingPro Tips for UMH, along with comprehensive metrics and expert analysis.

UMH Properties anticipates continued growth, with plans to expand its rental home program and develop additional sites. The company projects EPS for FY2026 and FY2027 at $0.21 and $0.24, respectively, with revenue forecasts of $282.16 million for FY2026 and $300.69 million for FY2027. InvestingPro assigns UMH a "GOOD" Financial Health score of 2.73, supported by a strong current ratio of 3.29 and a gross profit margin of 54.63%. For investors seeking comprehensive analysis, UMH is among the 1,400+ US equities covered by InvestingPro’s detailed Pro Research Reports, which transform complex data into actionable intelligence.

CEO Samuel A. Landy stated, "Our strategic focus on expanding our rental home program and increasing occupancy rates has yielded positive results this quarter. We remain committed to providing affordable housing solutions and anticipate continued growth in the coming quarters."

During the earnings call, analysts inquired about the company’s strategy for managing increased operating expenses and interest rates. Executives emphasized their focus on operational efficiencies and strategic investments to mitigate these challenges.

Operator: Good morning, and welcome to UMH Properties 1st quarter 2026 earnings conference call. It is now my pleasure to introduce your host, Mr. Craig Koster, Executive Vice President and General Counsel. Thank you. Mr. Koster, you may begin.

Craig Koster, Executive Vice President and General Counsel, UMH Properties: Thank you very much, operator. In addition to the 10-Q that we filed with the SEC yesterday, we have filed an unaudited first quarter supplemental information presentation. This supplemental information presentation, along with our 10-Q, are available on the company’s website at umh.reit. We would like to remind everyone that certain statements made during this conference call, which are not historical facts, may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements that we make on this call are based on our current expectations and involve various risks and uncertainties. Although the company believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the company can provide no assurance that its expectations will be achieved.

The risks and uncertainties that could cause actual results to differ materially from expectations are detailed in the company’s first quarter 2026 earnings release and filings with the Securities and Exchange Commission. The company disclaims any obligation to update its forward-looking statements. In addition, during today’s call, we will be discussing non-GAAP financial metrics. Reconciliations of these non-GAAP financial metrics to the comparable GAAP financial metrics, as well as the explanatory and cautioning language, are included in our earnings release, our supplemental information, and our historical SEC filings. Having said that, I would like to introduce management with us today. Eugene Landy, Founder and Chairman. Samuel Landy, President and Chief Executive Officer. Anna T. Chew, Executive Vice President and Chief Financial Officer. Brett Taft, Executive Vice President and Chief Operating Officer. Jim Vikins, Vice President of Capital Markets. Daniel Landy, Executive Vice President.

It is now my pleasure to turn the call over to UMH’s President and Chief Executive Officer, Samuel Landy.

Brett Taft, Executive Vice President and Chief Operating Officer, UMH Properties0: Thank you, Craig. Good morning, everyone. We are pleased to report solid operational results for the quarter, which we expect to continue to grow throughout the year. Normalized FFO for the first quarter of 2026 was $0.23 per share as compared to $0.23 per share last year. Our earnings per share were impacted by increased interest rates and increased investment in rental units and expansion lots which are not yet occupied. We faced seasonal headwinds, which impacted our sales volume and increased our community operating expenses. During the quarter, occupancy improved meaningfully, same-property NOI grew by 7%, and home sales revenue was stable. These gains were partially offset by higher interest costs associated with refinancing debt, bringing expansion lots online, adding rental homes, and the seasonal impact on home sales and operating expenses, which together moderated earnings per share growth.

NFFO per share came in essentially in line with last year’s first quarter, reflecting the strength of our core rental business offset by those financing and seasonal pressures. As we continue to fill rental homes and generate increased sales profits, our earnings should increase in the quarters to come. We have invested in rental homes, expansions, and acquisitions for which we currently incur interest expense, but will later become accretive to earnings. The fundamentals of our business remain strong with growing occupancy and improving community operating results. We are tightening our NFFO guidance range to $0.98 to $1.04 per share or $1.01 per share at the midpoint compared to our previous guidance of $0.97 to $1.05 per share. UMH continues to experience strong demand throughout our portfolio of quality manufactured housing communities.

This demand is being translated into increased occupancy rates and improved community operating results. During the quarter, overall occupancy improved by 184 units to approximately 88%. This increase was the result of the conversion of 166 homes from inventory to revenue-producing rental homes and an increase in occupancy of our existing rental homes. Additionally, sales of manufactured homes increased by 6% to $7.1 million for the quarter. This increase in sales includes the sales at Honey Ridge, which is owned through our joint venture with Nuveen. We continue to execute our long-term strategy of driving organic growth across our high-quality manufactured home communities. This organic growth translates to increased property values and, over time, increased earnings.

Rental and related income grew to $59.5 million for the quarter, representing a 9% increase over last year. Sales for the quarter were $7.1 million, including the sales at Honey Ridge, representing a 6% increase over the first quarter of last year. Our same-property results continue to demonstrate the effectiveness of our long-term business plan. We generally acquire underperforming communities with vacancies and in need of capital improvements. Our team and our platform have proven time and time again that we can preserve and increase the supply of affordable housing while delivering solid and sustainable operating results. In the first quarter of 2026, we delivered same-property revenue growth of 7.6% or $4.1 million and same-property NOI growth of 7.1% or $2.3 million.

This growth in same-property revenue and same-property NOI was driven by site rent increases of 5% and the increase in occupancy of 412 units over last year. Our expenses were elevated as a result of the bad winter as well as an increase in real estate taxes. This increase in community NOI substantially increases the value of our communities and our portfolio. We can realize this increase in value through our refinancing efforts, which generate additional capital to invest in our platform. Our occupancy gains continue to be driven by the successful implementation of our rental home program. During the quarter, we added and rented 166 new homes across our portfolio, including those in our joint venture communities, bringing our total rental home inventory to approximately 11,200 units with a 94.6% occupancy rate.

Our home rental program continues to operate efficiently with a turnover rate of approximately 20%. Our expenses per unit per year are approximately $400. Our capitalized turnover costs vary, but we are generally able to increase rents to earn 10% on any additional investment in rental homes. We are well-positioned to fill 800 or more new rental homes this year. We currently have 80 homes on site and ready for occupancy, 400 homes being set up, and 1