By M. Marin
NYSE:TRC
READ THE FULL TRC RESEARCH REPORT
Results often impacted by weather, crop & commodity prices, and other external factors
Tejon Ranch Company (NYSE:TRC) reported 3Q25 results last week. The company’s results in the farming and ranch segments are seasonal and impacted by weather, crop conditions, and other external factors. For the first nine months of 2025, the company generated a $1.2 million increase in almond crop revenues and $1.1 million in wine grape sales. TRC sold roughly 1.310 million pounds of almonds were compared to 1.045 million pounds in the comparable period in 2024.
Hard Rock Casino Tejon represents potential source of demand for units at TRC’s Terra Vista…
The company’s farming and mineral resources segments are impacted by extraneous factors such as fluctuations in commodity prices and crop production. Moreover, the timing of land sales and leasing are expected to impact the company’s real estate segments. Overall, these, among other factors, are likely to continue to contribute to potential interim fluctuations in the company’s operating results. Over time, however, if/when recurring monthly rental and leasing receipts comprise a growing component of the company’s total revenue and earnings, we would expect this to help smooth out the fluctuations.
Therefore, the opening of TRC’s first units at its multi-family residential complex adjacent to the Outlets at Tejon, Terra Vista, could represent an important measure in boosting a steady stream of rental revenues. TRC began leasing activities earlier this year, and Terra Vista began accepting new tenants in Phase 1 of Terra Vista’s opening in early May.
… with TRC working with the Casino to present benefits of Terra Vista to Casino employees…
The pending opening of the Hard Rock Casino Tejon as another source of potential demand for units at Terra Vista. Located near Terra Vista, the Hard Rock Casino Tejon is expected to create about 5,000 jobs. It is scheduled to open on November 13, 2025. TRC has indicated that it is working with the Casino management to present the benefits of residing at Terra Vista to Casino employees.
Moreover, California has some of the highest rental rates nationwide. TRCC is located in Kern County, which is experiencing a severe shortage of housing, like much of the state, including of apartment units, and of logistics space. Terra Vista’s 495 units are designed to be affordable studio, one, and two-bedroom apartment homes to address the need for more affordable housing in California. Statewide, there is a severe shortage of residential property that has led to a housing shortage problem, particularly affordable housing.
On its recent conference call, TRC reiterated its commitment to continuing the build-out of Terra Vista. In total, Terra Vista Phase 1 includes 228 of the planned 495 residential units. Once it is fully completed, Terra Vista at Tejon is expected to be the largest rental community in Kern County. Over time, however, as recurring monthly rental and leasing receipts comprise a growing component of the company’s total revenue and earnings, we would expect this to help smooth out the fluctuations.
UPCOMING INVESTOR DAY
…Company intends to outline plans expected to improve shareholder value at upcoming event
TRC has extensive land holdings that, in our view, are strategically positioned to provide much-needed industrial, commercial, and residential space in the state, but the company has been criticized by key shareholders in recent months for not delivering value to shareholders. The company is hosting an investor event this week and indicated that it intends to outline growth drivers and plans expected to deliver improved shareholder value.
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