Retail real estate investment trust (“REIT”) General Growth Properties, Inc. is expected to report second-quarter 2016 results on Aug 1, after the market closes.
Last quarter, the company delivered a positive surprise of 14.3%. For the trailing four quarters, General Growth Properties beat estimates in three quarters, posting in-line results in one, with an average positive surprise of 4.9%. The Zacks Consensus Estimate for second-quarter funds from operations (“FFO”) per share is currently pegged at 36 cents.
Let’s see how things have shaped up for this announcement.
Factors to Consider
General Growth Properties encounters competition from alternative types of retailing such as catalogs and e-Commerce websites. Rising consumer purchases through the Internet has emerged as a pressing concern for the retail REIT. While the company is striving to counter such pressure through various initiatives, the implementation of such measures requires a decent upfront cost. Consequently, this would limit any robust growth in its profit margins in the near term.
Further, General Growth Properties’ huge development and redevelopment pipeline is expected to drive its growth in the long-run, but raises operational risks.
However, the company enjoys a solid portfolio of high-quality retail properties across attractive locations that attract huge demand from retailers. The portfolio is complemented by flagship urban retail properties that are also in demand. Moreover, its solid tenant base and portfolio repositioning efforts augur well.
General Growth Properties’ activities during the quarter could not gain analyst confidence. Consequently, the Zacks Consensus Estimate remained unchanged at 36 cents over the last seven days.
Earnings Whispers
Our proven model does not conclusively show that General Growth Properties will beat on earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: Both the Most Accurate estimate and the Zacks Consensus Estimate stand at 36 cents. Hence, the Earnings ESP, which represents a difference between them, is 0.00%.
Zacks Rank: General Growth Properties has a Zacks Rank #4 (Sell). As it is we caution against stocks with Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are a few stocks in the real estate investment trust sector you may want to consider, as our model shows that they have the right combination of elements to post a positive surprise this quarter:
Sun Communities Inc. (SUI - Free Report) has an Earnings ESP of +2.44% and a Zacks Rank #2. The company will report results on Aug 2.
Regency Centers Corporation (REG - Free Report) has an Earnings ESP of +1.25% and a Zacks Rank #3. The company will release results on Aug 2.
National Health Investors Inc. (NHI - Free Report) has an Earnings ESP of +0.83% and a Zacks Rank #2. The company will report results on Aug 5.
Note: FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income. All earnings per share numbers presented in this write up represent FFO per share.
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Zacks Names "Single Best Pick to Double"
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It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
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Retail real estate investment trust (“REIT”) General Growth Properties, Inc. is expected to report second-quarter 2016 results on Aug 1, after the market closes.
Last quarter, the company delivered a positive surprise of 14.3%. For the trailing four quarters, General Growth Properties beat estimates in three quarters, posting in-line results in one, with an average positive surprise of 4.9%. The Zacks Consensus Estimate for second-quarter funds from operations (“FFO”) per share is currently pegged at 36 cents.
Let’s see how things have shaped up for this announcement.
Factors to Consider
General Growth Properties encounters competition from alternative types of retailing such as catalogs and e-Commerce websites. Rising consumer purchases through the Internet has emerged as a pressing concern for the retail REIT. While the company is striving to counter such pressure through various initiatives, the implementation of such measures requires a decent upfront cost. Consequently, this would limit any robust growth in its profit margins in the near term.
Further, General Growth Properties’ huge development and redevelopment pipeline is expected to drive its growth in the long-run, but raises operational risks.
However, the company enjoys a solid portfolio of high-quality retail properties across attractive locations that attract huge demand from retailers. The portfolio is complemented by flagship urban retail properties that are also in demand. Moreover, its solid tenant base and portfolio repositioning efforts augur well.
General Growth Properties’ activities during the quarter could not gain analyst confidence. Consequently, the Zacks Consensus Estimate remained unchanged at 36 cents over the last seven days.
Earnings Whispers
Our proven model does not conclusively show that General Growth Properties will beat on earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: Both the Most Accurate estimate and the Zacks Consensus Estimate stand at 36 cents. Hence, the Earnings ESP, which represents a difference between them, is 0.00%.
Zacks Rank: General Growth Properties has a Zacks Rank #4 (Sell). As it is we caution against stocks with Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are a few stocks in the real estate investment trust sector you may want to consider, as our model shows that they have the right combination of elements to post a positive surprise this quarter:
Sun Communities Inc. (SUI - Free Report) has an Earnings ESP of +2.44% and a Zacks Rank #2. The company will report results on Aug 2.
Regency Centers Corporation (REG - Free Report) has an Earnings ESP of +1.25% and a Zacks Rank #3. The company will release results on Aug 2.
National Health Investors Inc. (NHI - Free Report) has an Earnings ESP of +0.83% and a Zacks Rank #2. The company will report results on Aug 5.
Note: FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income. All earnings per share numbers presented in this write up represent FFO per share.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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