Why Is Vornado (VNO) Down 10.4% Since Last Earnings Report?

A month has gone by since the last earnings report for Vornado (VNO). Shares have lost about 10.4% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Vornado due for a breakout? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent catalysts for Vornado Realty Trust before we dive into how investors and analysts have reacted as of late.

Vornado's Q2 FFO Beats Estimates on Rent Starts, Same-Store NOI Grows

Vornado Realty Trust reported second-quarter 2026 FFO, as adjusted, of 67 cents per share, up 19.6% year over year. The figure beat the Zacks Consensus Estimate of 57 cents by 17.54%. Rent commencements, the NYU master lease and signage operations supported adjusted FFO growth.

Revenues rose 4.7% year over year to $462.2 million but missed the consensus mark of $472.4 million by 2.16%.

Vornado’s Revenue Mix Shows Rental Strength

Total rental revenues increased to $405.1 million from $382.3 million in the prior-year quarter. Property rentals were nearly flat year over year at $332.4 million, while tenant expense reimbursements increased to $46.3 million from $34.6 million.

Straight-line rental income rose to $26.3 million from $15.4 million. Fee and other income totaled $57.2 million compared with $59.2 million a year ago, as Building Maintenance Services cleaning fees declined to $33.3 million from $37.4 million.

Operating expenses increased to $223.7 million from $219.3 million. Depreciation and amortization climbed sharply to $171.2 million from $115.6 million.

Vornado’s Same-Store Results Highlight New York Growth

Total NOI at share increased to $304.1 million from $277.7 million. New York NOI at share rose to $251.7 million from $230.1 million, driven by gains across the office, street retail and residential assets.

New York office NOI at share increased to $183.4 million from $170.9 million year over year. New York Street Retail NOI rose to $52.5 million from $44.5 million, while New York residential NOI improved to $6.7 million from $6.4 million.

Total same-store NOI increased 9.8%, including growth of 11.9% in New York and 9.1% at THE MART. However, the metric declined 14.3% at 555 California Street. On a cash basis, total same-store NOI increased 2.9%, including growth of 6.2% in New York and 15.1% at THE MART.

Vornado’s Leasing Activity Remains Healthy

During the second quarter, Vornado leased 348,000 square feet of New York office space at an initial rent of $107.24 per square foot. The weighted average lease term was eight years.

For second-generation New York office space, straight-line rents increased 7.7% from prior rents. Cash-basis rents rose 5%, while tenant improvements and leasing commissions represented 13.3% of initial rent.

The company also leased 61,000 square feet of New York retail space and 103,000 square feet at THE MART. Straight-line rents on second-generation space increased 12.1% for retail and 14% at THE MART. Total portfolio occupancy stood at 90.8%, including 92.2% for the New York office.

Vornado Completes Manhattan Acquisition & Property Dispositions

Vornado completed the acquisition of a 49% interest in Park Avenue Plaza at a gross asset valuation of $1.1 billion. The 1.2-million-square-foot Manhattan office building is encumbered by a $575 million loan bearing a fixed interest rate of 2.99%.

Alexander’s, in which Vornado owns a 32.4% interest, sold Rego Park I for $235.5 million. Vornado recognized a $44.3 million share of the net gain. Separately, a 50%-owned consolidated joint venture sold 606 Broadway, generating a $32.1 million gain on debt extinguishment.

Vornado’s Liquidity Supports Capital Allocation

Vornado ended June with $675.4 million in cash and cash equivalents, $113.6 million of restricted cash and $1.19 billion available under its revolving credit facilities. Total liquidity was $1.98 billion.

During the reported quarter, the company repurchased about 1.79 million common shares for $53.46 million at an average price of $29.92 per share. As of Aug. 3, 2026, $286.6 million remained available under the repurchase program.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended upward during the past month.

VGM Scores

Currently, Vornado has a poor Growth Score of F, however its Momentum Score is doing a lot better with a B. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the second quintile for value investors.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. Notably, Vornado has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Research Chief Names "Single Best Pick to Double"

From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.

This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research