Is OUTFRONT Media Stock Still a Buy After Its 36% Rally?

OUTFRONT Media OUT is regaining investor attention as its operating performance improves and advertiser demand shifts toward high-impact, real-world visibility. While the stock has already surged 35.8% over the past three months, fundamentals suggest the rally may not be over. The company is executing well across transit, digital and cost management, while analysts continue to raise earnings expectations.

The Zacks Consensus Estimate for 2025 and 2026 funds from operations per share has moved higher over the past two months to $1.94 and $2.15, calling for year-over-year growth of 7.78% and 10.70%, respectively.

Over the past three months, shares of this Zacks Rank #2 (Buy) company have rallied 35.8% against the industry's decline of 1.6%. Given the strength of its fundamentals, this stock seems to have additional room for growth.

Price Performance: OUT

Factors That Make OUTFRONT Media Stock a Solid Pick

Transit Advertising Is Driving Growth: OUTFRONT’s transit segment delivered standout performance in the third quarter of 2025, with revenues up 24% year over year. Growth was led by strong demand across major markets, especially New York, where large national advertisers increased campaign activity. Digital transit revenues jumped more than 50%, showing that advertisers are leaning into premium, high-impact placements. This segment is now a key growth engine and is helping offset softness in traditional billboard contracts that the company intentionally exited.

Rising Cash Flow and Upgraded AFFO Outlook: Adjusted funds from operations climbed 24% year over year to $100 million in the third quarter. Management raised full-year 2025 AFFO growth guidance to the high single digits, up from a prior mid-single-digit outlook. This reflects stronger operating leverage, higher-margin transit revenues and tighter cost control. Improving AFFO supports both dividends and balance sheet strength.

Digital Transformation Is Gaining Traction: Digital now represents more than 35% of total revenues, and growth would have been even stronger without the exited billboard contracts. Programmatic and automated digital sales rose nearly 30% and continue to gain share. The partnership with AWS adds another layer, allowing planning, purchasing, and measurement of static and digital OOH inventory end-to-end using natural language through intelligent agents. This positions OUTFRONT well as ad buyers demand better data and flexibility.

Margins Are Expanding Due to Smarter Portfolio Decisions: Billboard adjusted OIBDA margins improved to 39.5%, helped by lease cost reductions and the exit of low-return contracts. Transit margins also swung meaningfully higher as revenue growth far outpaced expense increases. These margin gains show that management’s focus on quality revenues over volume is paying off.

Strong Liquidity and a Reliable Dividend: OUTFRONT refinanced its credit facilities, extending maturities into the next decade and ending the third quarter with more than $700 million in liquidity. Net leverage of 4.7X sits comfortably within the company’s target range of 4-5X. The board maintained the 30-cent quarterly dividend, backed by improving cash flow and a more stable balance sheet.

Taken together, OUTFRONT Media’s improving fundamentals, digital growth and cash flow momentum make OUT stock an increasingly compelling turnaround story.

Other Stocks to Consider

Some other top-ranked stocks from the broader REIT sector are Prologis PLD and First Industrial Realty Trust FR. Both Prologis and First Industrial Realty Trust carry a Zacks Rank of 2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Prologis’ 2025 FFO per share is pegged at $5.80, which indicates year-over-year growth of 4.32%.

The Zacks Consensus Estimate for First Industrial Realty Trust’s 2025 FFO per share stands at $2.96, which calls for an increase of 11.70% from the year-ago period. 

Note: Anything related to earnings presented in this write-up represents FFO, a widely used metric to gauge the performance of REITs.

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

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