One of the leading retail real estate investment trust (REIT),
Simon Property Group Inc. (
prepares to release its fourth-quarter 2012 results before the
opening bell on Monday, Feb 4.
EQUITY RESIDENT (EQR): Free Stock Analysis
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In the last quarter, it delivered a positive earnings surprise of
3.65% on the back of an increase in average rent and occupancy.
This represented the fourth straight quarter of positive earnings
surprise. Let's see how things are shaping up for the company
prior to the announcement.
Factors to Consider
Simon Property boasts a strong portfolio of assets and enjoys
competitive advantage through product and geographical
diversification. The significant acquisitions and partnerships
have further strengthened the company's presence in the core U.S.
markets. Benefiting from this, the company has performed
favorably in the last year. In the last quarter the company
signed joint venture deals with
Tanger Factory Outlet Centers Inc (
and Institutional Mall Investors ('IMI') for acquisition and
However, Simon Property's possessions consist primarily of
community shopping centers, making its performance dependent on
general economic conditions of the market for retail space. In
addition, the momentous development pipeline, which increases
operational risks in the current credit-constrained market, is
also a matter of concern.
Our proven model does not conclusively shows that Simon Property
is likely to beat the Zacks Consensus Estimate in the upcoming
quarter. To beat the estimate, a stock needs to have both a
positive Earnings ESP (Read:
Zacks Earnings ESP: A Better Method
) and a Zacks Rank #1, #2 or #3. However, this is not the case
here due to the following reasons:
Negative Zacks ESP:
The company's Most Accurate Estimate stands at $2.16, while the
Zacks Consensus is pegged slightly higher at $2.17. This results
in an Earnings ESP of -0.46%.
Zacks Rank #2 (Buy):
Simon Property's Zacks Rank of 2, however, increases the
predictive power of ESP. Nevertheless, we need to have a positive
ESP as well to be confident about an earnings surprise call.
Other Stocks to Consider
Here are some other REITs you may want to consider on the basis
of our model, which shows that they have the right combination of
elements to post an earnings beat this quarter:
Ventas Inc. (
has Earnings ESP of +2.06% and Zacks Rank #2. The company is
scheduled to report its earnings on Feb 15 before the opening
Equity Residential (
has Earnings ESP of +12.00% and Zacks Rank #3 (Hold). The company
is scheduled to report its earnings on Feb 5 after the closing