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Macerich (MAC) Stock Up Despite Q3 FFO and Revenue Miss

Shares of The Macerich Company MAC gained 1.49% on Nov 3 regular trading session on the NYSE following the release of its third-quarter results despite reporting lower-than-expected results.

MAC’s third-quarter funds from operations (FFO) per share of 46 cents, excluding financing expenses in relation to Chandler Freehold, grew 2.2% from the prior-year quarter’s 45 cents.  However, the figure missed the Zacks Consensus Estimate by a penny.

Quarterly revenues of $210.7 million in the third quarter lagged the Zacks Consensus Estimate of $215.1 million. Also, the figure was lower than the year-ago quarter’s $212.1 million.

Nonetheless, tenant sales continued to gain momentum and portfolio occupancy improved. Re-leasing spreads were the strongest since the end of third-quarter 2019.

The portfolio tenant sales per square foot for spaces less than 10,000 square feet in the trailing 12 months ended Sep 30, 2022, touched $877 compared with $801 as of Dec 31, 2019.

Behind the Headlines

As of Sep 30, 2022, portfolio occupancy was 92.1%, up from 90.3% on Sep 30, 2021.

For the 12 months ended Sep 30, 2022, re-leasing spreads were 6.6% more than the expiring base rent, marking the strongest since the end of third-quarter 2019.  

Same-center net operating income (NOI), including lease termination income, decreased 3.5% year over year.

Balance Sheet

As of Nov 3, MAC had more than $615 million of liquidity, including unrestricted cash in hand, aggregating more than $190 million. The balance represented the available capacity on its revolving line of credit.

2022 Guidance

Macerich narrowed the guidance range and decreased the midpoint of its 2022 FFO per share.

It expects 2022 FFO per share, excluding financing expenses in relation to Chandler Freehold, in the range of $1.93-$1.99, revised from the earlier expectation of $1.92-$2.04. The Zacks Consensus Estimate for the same is currently pegged at $1.94, which lies in the guided range.

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 and EPS Surprise
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

Kimco Realty Corp.’s KIM third-quarter 2022 FFO per share came in at 41 cents, surpassing the Zacks Consensus Estimate of 39 cents. The figure grew 28.1% from the year-ago quarter’s 32 cents.

Results reflect year-over-year growth in the top line. The rise in occupancy levels and rental rate growth aided Kimco’s performance. It raised the 2022 FFO per share outlook.

Simon Property Group, Inc.’s SPG third-quarter 2022 comparable FFO per share of $2.97 exceeded the Zacks Consensus Estimate of $2.93. The figure compares favorably with the year-ago quarter’s $2.92.

SPG’s results reflect healthy operating performance and growth in occupancy levels. Based on the quarterly results, this retail REIT behemoth raised the 2022 FFO per share outlook and announced a hike in the quarterly dividend.

SITE Centers Corp. SITC reported third-quarter 2022 operating FFO (OFFO) per share of 29 cents, beating the Zacks Consensus Estimate by a cent. The figure was in line with the prior-year quarter’s FFO per share.

SITC’s results reflect healthy leasing activity and a year-over-year improvement in annualized base rent.

Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.


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