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Simon Property (SPG) Soars 4.1%: Is Further Upside Left in the Stock?

Simon Property SPG shares rallied 4.1% in the last trading session to close at $111.97. This move can be attributable to notable volume, with a higher number of shares being traded than in a typical session. This compares to the stock's 12.5% loss over the past four weeks.

The increased optimism in the stock is attributable to the rebounding retail real estate market in the United States.

Simon Property recently announced that it would collaborate with José Andrés Group (“JAG”) to bring award-winning restaurants to several of its premier properties. The move is expected to draw more shoppers to SPG’s shopping centers, making it a strategic fit.

This shopping mall real estate investment trust is expected to post quarterly funds from operations (FFO) of $2.81 per share in its upcoming report, which represents a year-over-year change of +1.1%. Revenues are expected to be $1.33 billion, up 2.7% from the year-ago quarter.

While FFO and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in FFO estimate revisions and near-term stock price movements.

For Simon Property, the consensus FFO per share estimate for the quarter has been revised marginally lower over the last 30 days to the current level. And a negative trend in FFO estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on SPG going forward to see if this recent jump can turn into more strength down the road.


The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Simon Property belongs to the Zacks REIT and Equity Trust - Retail industry. Another stock from the same industry, National Retail Properties NNN, closed the last trading session 2% higher at $44.15. Over the past month, NNN has returned -5.2%.

For National Retail Properties, the consensus FFO per share estimate for the upcoming report has remained unchanged over the past month at $0.80. This represents a change of +1.3% from what the company reported a year ago. National Retail Properties currently has a Zacks Rank of #3 (Hold).

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