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Macerich's (MAC) Q3 FFO In Line, Revenues Beat Estimates

The Macerich CompanyMAC reported third-quarter 2016 funds from operations ("FFO") per share of $1.04, which came in line with the Zacks Consensus Estimate and higher than the prior-year quarter tally of $1.01. Improvement in releasing spread and same center net operating income aided the results.

Macerich posted revenues of $253.4 million, surpassing the Zacks Consensus Estimate $247 million. Revenues were $326.3 million in the year-ago quarter.

Quarter in Detail

As of Sep 30, 2016, mall portfolio occupancy decreased 10 basis points (bps) year over year to 95.3%. Mall tenant annual sales decreased to $626 per square foot from the $630 at the end of third-quarter 2015. In addition, re-leasing spreads rose 16.1% on a year-over-year basis. Also, same centers net operating income grew 4.2% during the quarter.

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As of Sep 30, 2016, on a pro rata basis, Macerich's share of cash and cash equivalents were $94.6 million, compared with $149.9 million as of Jun 30, 2016.

2016 Guidance

Macerich has revised its guidance for 2016. The REIT expects FFO per share in a range of $4.05-$4.10 from the previous range of $4.05-$4.15. The 2016 Zacks Consensus Estimate of $4.11 does not fall in the range. Also, the company anticipates 2016 cash same store NOI to grow 4.50-4.75%.

Our Viewpoint

We believe Macerich's premium operating portfolio shows promise, going forward. Improving NOI growth and re-leasing spreads would pave the way for a robust top line.

Currently, Macerich has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .

MACERICH CO Price, Consensus and EPS Surprise

MACERICH CO Price, Consensus and EPS Surprise | MACERICH CO Quote

Some important REITs which are slated to report next week include Taubman Centers, Inc. TCO , Regency Centers Corporation REG and Host Hotels & Resorts, Inc. HST .

Note: All EPS numbers presented in this write-up represent funds from operations ("FFO") per share. FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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