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Simon Property (SPG) to Post Q3 Earnings: What to Expect?
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Simon Property Group Inc. (SPG - Free Report) is scheduled to report third-quarter 2017 results on Oct 27, before the market opens.
In the last reported quarter, this Indianapolis, IN-based retail real estate investment trust (REIT) witnessed a positive surprise of 0.82% in terms of funds from operations (FFO) per share.
However, over the trailing four quarters, the company exceeded the Zacks Consensus Estimate in three occasions and missed in the other, the average beat being 4.20%. This is depicted in the graph below:
Let’s see how things are shaping up for this announcement.
Factors to Consider
Simon Property enjoys a wide exposure to retail assets across the United States. Moreover, the company’s international presence fosters sustainable long-term growth as compared with its domestically-focused peers. This diversification, with respect to both product and geography, largely insulates Simon Property from market volatility and helps it stay ahead of its peers by delivering a decent performance.
Further, Simon Property has been undertaking various initiatives, of late, to strengthen its relationship with customers. In addition, with the omni-channel strategy gaining popularity among retailers, the company is initiating programs and events, as well as entering into several partnerships for upgrading services and amenities offered to its customers. This retail REIT has invested more than $5 billion in development projects in five years’ time and intends to spend around $1 billion each in 2017 and 2018. These initiatives are anticipated to draw more traffic at the company’s properties.
Nevertheless, with more and more consumers opting for online purchases, mall traffic continues to remain depressed considerably. This, again, has resulted in an increasing number of retailers joining the dot-com bandwagon. These latest developments have made retailers reconsider their footprint and eventually opt for store closures in recent times.
Further, retailers unable to keep up with the intense competition in the industry are filing bankruptcies. This is a pressing concern for retail REITs, as the trend has been significantly dragging down demand for the retail real estate space. This choppy retail real estate market situation is also said to have led to tenants demanding substantial lease concessions, though the mall landlords find it unjustified.
While Simon Property is grappling to battle this pressure through various initiatives, the implementation of such measures requires a decent upfront cost. Consequently, this would limit any robust growth in the company’s profit margins in the to-be-reported quarter.
Amid these, the Zacks Consensus Estimate for third-quarter revenues is currently pegged at $1.4 billion, indicating projected growth of around 3.1% year over year.
Moreover, prior to the third-quarter earnings release, there is lack of any solid catalyst. As such, the Zacks Consensus Estimate of FFO per share for the quarter remained unchanged at $2.87 over the past month.
Shares of Simon Property have climbed 2.4%, versus the 1.1% loss incurred by the industry, in three months’ time.
Earnings Whispers
Our proven model does not conclusively show that Simon Property will likely beat estimates 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 at least 3 (Hold) for this to happen. But that is not the case here, as you will see below.
Zacks ESP: The Earnings ESP, which represents the percentage difference between the Most Accurate estimate and the Zacks Consensus Estimate, is -0.77%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Simon Property’s Zacks Rank #2 increases the predictive power of ESP. However, we also need to have a positive ESP to be confident of an earnings beat.
Stocks That Warrant a Look
Here are a few stocks in the REIT sector that you may want to consider, as our model shows that these have the right combination of elements to report a positive surprise this quarter:
Extra Space Storage Inc. (EXR - Free Report) , scheduled to release earnings on Nov 1, has an Earnings ESP of +2.23% and a Zacks Rank of 2.
Cousins Properties Inc. (CUZ - Free Report) , slated to release quarterly numbers on Oct 25, has an Earnings ESP of +1.13% and a Zacks Rank of 3.
Note: All EPS numbers presented in this write up represent funds from operations (FFO) per share. 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.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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Simon Property (SPG) to Post Q3 Earnings: What to Expect?
Simon Property Group Inc. (SPG - Free Report) is scheduled to report third-quarter 2017 results on Oct 27, before the market opens.
In the last reported quarter, this Indianapolis, IN-based retail real estate investment trust (REIT) witnessed a positive surprise of 0.82% in terms of funds from operations (FFO) per share.
However, over the trailing four quarters, the company exceeded the Zacks Consensus Estimate in three occasions and missed in the other, the average beat being 4.20%. This is depicted in the graph below:
Simon Property Group, Inc. Price and EPS Surprise
Simon Property Group, Inc. Price and EPS Surprise | Simon Property Group, Inc. Quote
Let’s see how things are shaping up for this announcement.
Factors to Consider
Simon Property enjoys a wide exposure to retail assets across the United States. Moreover, the company’s international presence fosters sustainable long-term growth as compared with its domestically-focused peers. This diversification, with respect to both product and geography, largely insulates Simon Property from market volatility and helps it stay ahead of its peers by delivering a decent performance.
Further, Simon Property has been undertaking various initiatives, of late, to strengthen its relationship with customers. In addition, with the omni-channel strategy gaining popularity among retailers, the company is initiating programs and events, as well as entering into several partnerships for upgrading services and amenities offered to its customers. This retail REIT has invested more than $5 billion in development projects in five years’ time and intends to spend around $1 billion each in 2017 and 2018. These initiatives are anticipated to draw more traffic at the company’s properties.
Nevertheless, with more and more consumers opting for online purchases, mall traffic continues to remain depressed considerably. This, again, has resulted in an increasing number of retailers joining the dot-com bandwagon. These latest developments have made retailers reconsider their footprint and eventually opt for store closures in recent times.
Further, retailers unable to keep up with the intense competition in the industry are filing bankruptcies. This is a pressing concern for retail REITs, as the trend has been significantly dragging down demand for the retail real estate space. This choppy retail real estate market situation is also said to have led to tenants demanding substantial lease concessions, though the mall landlords find it unjustified.
While Simon Property is grappling to battle this pressure through various initiatives, the implementation of such measures requires a decent upfront cost. Consequently, this would limit any robust growth in the company’s profit margins in the to-be-reported quarter.
Amid these, the Zacks Consensus Estimate for third-quarter revenues is currently pegged at $1.4 billion, indicating projected growth of around 3.1% year over year.
Moreover, prior to the third-quarter earnings release, there is lack of any solid catalyst. As such, the Zacks Consensus Estimate of FFO per share for the quarter remained unchanged at $2.87 over the past month.
Shares of Simon Property have climbed 2.4%, versus the 1.1% loss incurred by the industry, in three months’ time.
Earnings Whispers
Our proven model does not conclusively show that Simon Property will likely beat estimates 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 at least 3 (Hold) for this to happen. But that is not the case here, as you will see below.
Zacks ESP: The Earnings ESP, which represents the percentage difference between the Most Accurate estimate and the Zacks Consensus Estimate, is -0.77%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Simon Property’s Zacks Rank #2 increases the predictive power of ESP. However, we also need to have a positive ESP to be confident of an earnings beat.
Stocks That Warrant a Look
Here are a few stocks in the REIT sector that you may want to consider, as our model shows that these have the right combination of elements to report a positive surprise this quarter:
CoreSite Realty Corporation (COR - Free Report) , slated to release third-quarter results on Oct 26, has an Earnings ESP of +1.01% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Extra Space Storage Inc. (EXR - Free Report) , scheduled to release earnings on Nov 1, has an Earnings ESP of +2.23% and a Zacks Rank of 2.
Cousins Properties Inc. (CUZ - Free Report) , slated to release quarterly numbers on Oct 25, has an Earnings ESP of +1.13% and a Zacks Rank of 3.
Note: All EPS numbers presented in this write up represent funds from operations (FFO) per share. 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.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>