BMO Capital downgraded Alexandria Real Estate (NYSE: ARE) to Market Perform from Outperform and set a $52 price target, citing concerns around growth prospects and macroeconomic pressures.
The firm noted that it had maintained a more positive stance following disappointing 2026 guidance issued in December, expecting that asset sales would alleviate concerns around equity overhang. This dynamic initially supported the stock, which rose 21.9% year-to-date as of mid-January.
However, BMO said the outlook has since been overshadowed by rising interest rates and potential risks to lab office demand associated with artificial intelligence developments.
The firm added that it prefers companies with stronger earnings growth trajectories, which it does not expect from Alexandria Real Estate, particularly as the company plans to sell approximately $2.9 billion in assets this year.
