Friday was a day to forget for Federal Realty Investment Trust (FRT -6.07%) and its investors. The real estate investment trust (REIT) posted its fourth-quarter and full-year results, and the market clearly wasn't impressed by the performance. It sent the stock to a 6% loss on a day when the S&P 500 index basically traded sideways.

A decent if unspectacular quarter

After market close on Thursday, Federal divulged that it earned $311 million during the quarter, representing improvement of almost 7% on a year-over-year basis. Net income, a line item that directly affects the size of the dividend a REIT can pay investors, inched up by 2% to nearly $66 million ($0.75 per share).

Funds from operations (FFO), considered a more accurate measure of a REIT's profitability, was 9% higher at almost $148 million.

Q4 revenue and net-income figures were essentially in line with analyst estimates.

A near miss with profitability guidance

In its earnings release, Federal also proffered its initial guidance for full-year 2025. It's modeling net income of $3.00 to $3.12 per share for the year, which is a key reason for the investor sell-off (the consensus pundit projection is a bit higher, at $3.13). Management also forecast annual FFO of $7.10 to $7.22.

I've been a fan of Federal's portfolio for some time, as the company has cleverly positioned itself as a landlord of durable properties in the retail sector located in relatively affluent areas. Yes, guidance could have been more encouraging, but this REIT is a stable operator and in my view one of the better retail REITs. It probably didn't deserve the market's punishment on Friday.