Lineage 2Q AFFO ahead; Ops showing some early signs of improvement

Research evidence excerpt

J P M O R G A N

North America Equity Research

05 August 2026

Lineage

2Q AFFO ahead; Ops showing some early signs of

improvement

Underweight

LINE, LINE US

Price (04 Aug 26):$41.94

REITs

Before Wednesday’s open, Lineage (LINE) reported 2Q results (AFFO) that were

ahead of JPM/Street and it slightly increased the FY guidance outlook, even with

some previously unanticipated headwinds stemming from a recent facility fire.

Messaging on the call was similar to what it was on the 1Q call and NAREIT,

namely that that business fundamentals have stabilized and it continues to see some

signs of improvement (such as 2Q occupancy trends and pricing to customers). On

the capital recycling front, there was nothing announced as it relates to a strategic

JV and/or asset sales, but management noted that it was encouraged by private

market pricing discussions and it believes we could see an announcement by YE.

2Q AFFO ahead on a variety of items. LINE reported 2Q AFFO/share of $0.76

which was ahead of JPM at $0.72 and the Bloomberg consensus of $0.71. It also

reported Adjusted EBITDA of $320 million which was almost on top of our

comparable ~$318+ million forecast. Management said both AFFO and EBITDA

were ahead of internal forecasts and that it was encouraged from seeing additional

signs of the fundamentals firming. Compared to our comparable AFFO and

EBITDA estimates, total NOI for warehouse and GIS (combined) was a little lower

than our forecast by roughly ~$0.01+. That gap would have flipped to a slight

outperformance if we excluded the settlement expense in GIS. Outside of

warehouse/GIS, total G&A came in lighter by roughly ~$0.03+ and taxes also

added ~$0.02 of upside. Offsetting that, recurring cap ex and interest expense were

both slightly higher than we modeled for the quarter at ~$0.01 each.

Michael W. Mueller, CFA AC

(1-212) 622-6689

Anthony Paolone, CFA

(1-212) 622-6682

Nahom Tesfazghi

(1-212) 622 4884

Daniella De Armas Rosales

(1-212) 622-0050

J.P. Morgan Securities LLC

Slight SS warehouse NOI and AFFO guidance bumps. Management raised

LINE-defined AFFO guidance to $2.90 to $3.05 from $2.75 to $3.00, a $0.10/share

increase at the midpoint.…