Simon Property Group in 3Q15: Healthy Earnings Boost Stock



Simon Property’s earnings review

Simon Property Group (SPG), the largest US retail REIT, reported its 3Q15 earnings on October 27, 2015. The company’s EPS (earnings per share) for 3Q15 was $1.36, much higher than the consensus estimate of $1.20. FFO (funds from operations) per share for 3Q15 was $2.54, higher than the consensus estimate of $2.46.

Simon’s revenue of $1.32 billion was marginally higher than the consensus estimate of $1.30 billion. The company recorded a 6.2% increase in net operating income year-over-year to $1.4 billion.

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Positive market reaction

The markets gave a thumbs up to Simon Property’s 3Q15 earnings. The stock rose 0.9% soon after the earnings release. Eventually, the stock closed at $206.19, gaining 1.4% from the previous day’s closing.

Simon Property (SPG) has experienced a strong stock performance lately. Year-to-date (or YTD), shares have risen 13.2%. During the last one month, SPG stock has risen 12.8%. Other major apartment REITs such as General Growth Properties (GGP), Macerich (MAC), and Taubman Centers (TCO) have experienced lackluster performances with YTD returns of 2.6%, 2.1%, and 1.2%, respectively. Similarly, the broader SPDR DJ Wilshire REIT ETF (RWR) has risen by a mere 1.4% YTD.

Series overview

In this series, we’ll explore Simon Property Group’s 3Q15 earnings in detail. We’ll discuss what factors could drive its earnings in the coming quarters. We’ll also cover the key points from the company’s 3Q15 earnings conference call.


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