Stable Outlook for Simon Property Group Amid Modest FFO Shortfall Warrants Hold Rating

Ronald Kamdem, an analyst from Morgan Stanley, maintained the Hold rating on Simon Property (SPG – Research Report). The associated price target remains the same with $170.00.

Ronald Kamdem’s rating is based on several key factors influencing Simon Property Group’s financial outlook. The company’s reaffirmation of its 2025 Real Estate Funds From Operations (FFO) guidance at approximately $12.53 per share suggests stability, yet it falls slightly short of consensus expectations. This guidance remains unchanged from previous calls, indicating no significant shifts in the company’s financial strategy or assumptions, such as domestic property net operating income and interest expense projections.
Additionally, while the dividend has increased by 5% year-over-year, it remains unchanged quarter-over-quarter, reflecting a cautious approach to shareholder returns. The modest shortfall in headline FFO per share for the first quarter, due to factors such as losses on other platform investments and derivative losses, further supports a Hold rating. These elements combined suggest a stable but not overly optimistic outlook, warranting a Hold recommendation.

In another report released yesterday, Truist Financial also maintained a Hold rating on the stock with a $168.00 price target.