We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Macerich (MAC) Q2 FFO, Revenues Miss, NOI Slips, Stock Down
Read MoreHide Full Article
Shares of The Macerich Company (MAC - Free Report) depreciated 0.61% during Tuesday’s regular trading session after the company reported lower-than-expected numbers both in terms of adjusted funds from operations (FFO) per share and revenues for second-quarter 2020.
Macerich delivered adjusted FFO per share of 39 cents which missed the Zacks Consensus Estimate of 46 cents. The figure also plunged 55.7% year over year. Adjusted FFO per share for the quarter excludes financing expense in relation to Chandler Freehold and loss on extinguishment of debt.
Results reflect the pandemic’s adverse impact and the related temporary closure of its properties as well as rent collection woes.
The company generated revenues of $178.6 million in the June-end quarter. The figure declined 21.7% year on year as well as missed the Zacks Consensus Estimate of $191 million.
The company noted that majority of its properties are now open. However, Queens Center and Kings Plaza in New York City have been closed since March 2020, while nine indoor California malls, which previously opened in May and early June, were closed for a second time in July pursuant to a statewide mandate.
Macerich is making negotiations with national and local tenants to secure rental payments, and has collected roughly 58% and 66% of billings in June and July, respectively.
Moreover, the company noted that it has entered into several leases for new stores and concepts aggregating 1.3 million square feet for planned openings in mainly 2020 and 2021. It has slashed the planned 2020 development expends by roughly $90 million, though work continues on some select projects.
In March, Macerich withdrew the previously-issued guidance for 2020. It has not issued any updated outlook as of now due to the prevailing uncertainties.
Behind the Headlines
As of Jun 30, 2020, average rent per square foot rose 2.1% to $62.48 from $61.17 as of Jun 30, 2019. Mall tenant annual sales for the 12-month period ended Jun 30, 2020 decreased to $774 per square feet from $776 for the 12-month period ended Jun 30, 2019. Notably, the sales metric excludes the period of coronavirus closure for each tenant.
However, as of Jun 30, 2020, the mall portfolio occupancy shrunk 280 basis points year over year to 91.3%. Also, same-center net operating income (excluding lease termination income) slid 23.1% to $163 million from the prior-year number.
It exited second-quarter 2020 with $497.6 million of cash and cash equivalents on its balance sheet.
Currently, Macerich carries a Zacks Rank #4 (Sell).
Simon Property Group, Inc.’s (SPG - Free Report) second-quarter 2020 FFO per share of $2.12 missed the Zacks Consensus Estimate of $2.31. The reported figure also plunged 29.1% from the year-ago quarter’s $2.99. Results reflected the pandemic’s adverse impact on the company’s domestic and international operations, with an impact of $1.13 per share, mainly on reduced lease income and ancillary property revenues. Nevertheless, these negatives were partly offset by roughly 36 cents per share from cost-reduction moves.
Kimco Realty Corp.’s (KIM - Free Report) second-quarter FFO per share came in at 24 cents, marginally surpassing the Zacks Consensus Estimate of 23 cents. Results reflected healthy rental rate leasing spreads on new lease and renewals. Nonetheless, same-property net operating income (NOI) was affected mainly due to a charge for potentially uncollectible accounts receivable.
Regency Centers Corporation’s (REG - Free Report) second-quarter NAREIT FFO per share of 61 cents missed the Zacks Consensus Estimate of 78 cents. The reported figure was also 35.8% lower than the prior-year quarter’s 95 cents. Results displayed a decline in same-property net operating income (NOI) on a higher rate of uncollectible lease income in relation to the pandemic.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
Zacks Top 10 Stocks for 2020
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?
Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Image: Bigstock
Macerich (MAC) Q2 FFO, Revenues Miss, NOI Slips, Stock Down
Shares of The Macerich Company (MAC - Free Report) depreciated 0.61% during Tuesday’s regular trading session after the company reported lower-than-expected numbers both in terms of adjusted funds from operations (FFO) per share and revenues for second-quarter 2020.
Macerich delivered adjusted FFO per share of 39 cents which missed the Zacks Consensus Estimate of 46 cents. The figure also plunged 55.7% year over year. Adjusted FFO per share for the quarter excludes financing expense in relation to Chandler Freehold and loss on extinguishment of debt.
Results reflect the pandemic’s adverse impact and the related temporary closure of its properties as well as rent collection woes.
The company generated revenues of $178.6 million in the June-end quarter. The figure declined 21.7% year on year as well as missed the Zacks Consensus Estimate of $191 million.
The company noted that majority of its properties are now open. However, Queens Center and Kings Plaza in New York City have been closed since March 2020, while nine indoor California malls, which previously opened in May and early June, were closed for a second time in July pursuant to a statewide mandate.
Macerich is making negotiations with national and local tenants to secure rental payments, and has collected roughly 58% and 66% of billings in June and July, respectively.
Moreover, the company noted that it has entered into several leases for new stores and concepts aggregating 1.3 million square feet for planned openings in mainly 2020 and 2021. It has slashed the planned 2020 development expends by roughly $90 million, though work continues on some select projects.
In March, Macerich withdrew the previously-issued guidance for 2020. It has not issued any updated outlook as of now due to the prevailing uncertainties.
Behind the Headlines
As of Jun 30, 2020, average rent per square foot rose 2.1% to $62.48 from $61.17 as of Jun 30, 2019. Mall tenant annual sales for the 12-month period ended Jun 30, 2020 decreased to $774 per square feet from $776 for the 12-month period ended Jun 30, 2019. Notably, the sales metric excludes the period of coronavirus closure for each tenant.
However, as of Jun 30, 2020, the mall portfolio occupancy shrunk 280 basis points year over year to 91.3%. Also, same-center net operating income (excluding lease termination income) slid 23.1% to $163 million from the prior-year number.
It exited second-quarter 2020 with $497.6 million of cash and cash equivalents on its balance sheet.
Currently, Macerich carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Macerich Company The Price, Consensus and EPS Surprise
Macerich Company The price-consensus-eps-surprise-chart | Macerich Company The Quote
Performance of Other Retail REITs
Simon Property Group, Inc.’s (SPG - Free Report) second-quarter 2020 FFO per share of $2.12 missed the Zacks Consensus Estimate of $2.31. The reported figure also plunged 29.1% from the year-ago quarter’s $2.99. Results reflected the pandemic’s adverse impact on the company’s domestic and international operations, with an impact of $1.13 per share, mainly on reduced lease income and ancillary property revenues. Nevertheless, these negatives were partly offset by roughly 36 cents per share from cost-reduction moves.
Kimco Realty Corp.’s (KIM - Free Report) second-quarter FFO per share came in at 24 cents, marginally surpassing the Zacks Consensus Estimate of 23 cents. Results reflected healthy rental rate leasing spreads on new lease and renewals. Nonetheless, same-property net operating income (NOI) was affected mainly due to a charge for potentially uncollectible accounts receivable.
Regency Centers Corporation’s (REG - Free Report) second-quarter NAREIT FFO per share of 61 cents missed the Zacks Consensus Estimate of 78 cents. The reported figure was also 35.8% lower than the prior-year quarter’s 95 cents. Results displayed a decline in same-property net operating income (NOI) on a higher rate of uncollectible lease income in relation to the pandemic.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
Zacks Top 10 Stocks for 2020
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?
Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2020 today >>