Simon Property (SPG) AI Stock Analysis

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Simon Property

(NYSE:SPG)

73Outperform

Simon Property Group exhibits strong financial performance and positive operational metrics, particularly in leasing and occupancy. However, its high leverage and potential macroeconomic uncertainties pose risks. The stock's technical indicators suggest modest short-term strength, while the valuation is attractive due to a high dividend yield. Overall, the stock shows promise but requires monitoring of leverage and economic conditions.

Positive Factors

Dividend

A dividend of $2.10 was declared, which is an increase of 5.0% year-over-year.

Occupancy Rate

Occupancy rate increased to 95.9%, showing a year-over-year improvement.

Valuation

The stock is trading at a significant discount to its estimated net asset value, suggesting potential for price appreciation.

Negative Factors

Earnings

1Q headline FFO per share of $2.67 fell short of consensus estimates of $2.91.

Market Performance

Mall REITs, including Simon Property Group, have underperformed the broader market indices, reflecting challenges in the sector.

Sales

Reported tenant sales did decline to $733/sqf from $739/sqf.

Simon Property (SPG) vs. S&P 500 (SPY)

Market Cap

$62.27B

Dividend Yield5%

Average Volume (3M)2.01M

Price to Earnings (P/E)24.4

Beta (1Y)0.96

Revenue Growth4.25%

EPS Growth-14.90%

CountryUS

Employees2,600

SectorReal Estate

Sector Strength67

IndustryREIT - Retail

Share Statistics

EPS (TTM)1.27

Shares Outstanding326,417,050

10 Day Avg. Volume1,818,213

30 Day Avg. Volume2,007,600

Financial Highlights & Ratios

PEG Ratio-1.94

Price to Book (P/B)20.68

Price to Sales (P/S)0.00

P/FCF Ratio17.69

Enterprise Value/Market Cap1.25

Enterprise Value/Revenue3.28

Enterprise Value/Gross Profit15.68

Enterprise Value/Ebitda3.92

Forecast

1Y Price Target

$178.50

Price Target Upside8.10% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering8

Simon Property Business Overview & Revenue Model

Company DescriptionSimon is a real estate investment trust engaged in the ownership of premier shopping, dining, entertainment and mixed-use destinations and an S&P 100 company (Simon Property Group, NYSE: SPG). Our properties across North America, Europe and Asia provide community gathering places for millions of people every day and generate billions in annual sales.

How the Company Makes MoneySimon Property Group makes money primarily through the collection of rental income from its extensive portfolio of retail properties. The company's revenue model consists of various key streams, including base minimum rents, overage rents that are contingent on a tenant's sales performance, and common area maintenance charges. Additionally, Simon Property generates income from ancillary services, such as parking, advertising, and sponsorship deals within its centers. The company also benefits from strategic partnerships and joint ventures that enhance its asset base and tenant mix. Furthermore, Simon Property capitalizes on its scale and expertise in property management to drive value through redevelopment and expansion projects, enhancing the appeal and profitability of its properties.

Simon Property Key Performance Indicators (KPIs)

Any

Revenue by Segment

Revenue by Segment
Analyzes income from different business areas, highlighting which segments drive growth and profitability, and identifying potential vulnerabilities or opportunities for expansion.

Chart InsightsSimon Property's lease income has rebounded strongly post-pandemic, with a notable upward trend continuing into 2024. This is supported by robust leasing activities and high occupancy rates, as highlighted in their recent earnings call. The company's strategic focus on redevelopment and new acquisitions, such as the Italian luxury outlets, is poised to sustain this growth. However, potential risks from higher interest expenses and economic factors like tariffs could impact future profitability. The positive sentiment is reinforced by a significant dividend increase, reflecting confidence in ongoing financial health.

Data provided by:

Main Street Data

Simon Property Financial Statement Overview

Summary

Simon Property demonstrates strong profitability and cash flow generation, with robust EBIT and EBITDA margins. However, the high debt-to-equity ratio poses a potential risk to financial stability, necessitating careful monitoring of leverage levels.

Income Statement

Positive

Simon Property shows strong profitability with a stable gross profit margin of 78.6% TTM and a net profit margin of 27.3% TTM. The revenue growth rate TTM is 0.5%, indicating modest growth. The EBIT and EBITDA margins are robust at 51.5% and 72.9% respectively, highlighting efficient operational management. However, the revenue growth is relatively low, which may limit future profitability expansion.

Balance Sheet

Positive

The company has a high debt-to-equity ratio of 8.24 TTM, suggesting significant leverage which could pose financial risks in adverse market conditions. The return on equity is strong at 54.5% TTM, indicating effective use of equity to generate profits. The equity ratio is low at 9.2% TTM, reflecting a heavy reliance on debt financing. While profitability is solid, the high leverage could undermine financial stability.

Cash Flow

Very Positive

Simon Property exhibits strong cash flow management with a free cash flow growth rate of 20.6% TTM. The operating cash flow to net income ratio is favorable at 2.29 TTM, showing efficient cash generation relative to net income. The free cash flow to net income ratio is robust at 2.25 TTM, indicating strong cash profitability. Despite strong cash flow metrics, the reliance on debt financing remains a concern.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
5.99B	5.96B	5.66B	5.29B	5.12B	4.61B
	Gross Profit
4.96B	4.92B	4.73B	4.29B	4.15B	3.72B
	EBIT
3.09B	3.09B	2.81B	2.58B	2.41B	1.97B
	EBITDA
4.63B	5.02B	4.07B	4.59B	4.46B	3.41B
	Net Income Common Stockholders
2.05B	2.37B	2.28B	2.14B	2.25B	1.11B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.38B	1.40B	2.17B	621.63M	533.94M	1.01B
	Total Assets
32.50B	32.41B	34.28B	33.01B	33.78B	34.79B
	Total Debt
25.27B	24.78B	26.52B	25.46B	25.83B	27.24B
	Net Debt
23.89B	23.38B	25.35B	24.84B	25.29B	26.23B
	Total Liabilities
29.23B	28.81B	30.60B	29.19B	29.38B	31.13B
	Stockholders Equity
2.61B	2.94B	3.02B	3.14B	3.36B	3.04B
Cash Flow		Free Cash Flow
3.05B	3.06B	3.14B	3.12B	3.11B	1.84B
	Operating Cash Flow
3.87B	3.81B	3.93B	3.77B	3.64B	2.33B
	Investing Cash Flow
337.08M	1.41B	-1.36B	-626.56M	-552.76M	-3.98B
	Financing Cash Flow
-4.08B	-4.99B	-2.02B	-3.05B	-3.56B	1.99B

Simon Property Technical Analysis

Technical Analysis Sentiment

Positive

Last Price165.12

Price Trends

50DMA

159.16

Positive

100DMA

167.36

Negative

200DMA

166.47

Negative

Market Momentum

MACD

1.81

Negative

RSI

56.70

Neutral

STOCH

35.18

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SPG, the sentiment is Positive. The current price of 165.12 is above the 20-day moving average (MA) of 159.39, above the 50-day MA of 159.16, and below the 200-day MA of 166.47, indicating a neutral trend. The MACD of 1.81 indicates Negative momentum. The RSI at 56.70 is Neutral, neither overbought nor oversold. The STOCH value of 35.18 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SPG.

Simon Property Risk Analysis

Simon Property disclosed 35 risk factors in its most recent earnings report. Simon Property reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Simon Property Peers Comparison

Overall Rating

UnderperformOutperform

Sector (60)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KIM	80 Outperform	$14.67B	27.96	5.19%	4.52%	12.55%	45.10%
SPG	73 Outperform	$62.27B	24.36	73.22%	5.00%	4.25%	-14.90%
BRX	73 Outperform	$8.14B	24.96	10.99%	4.21%	4.58%	12.65%
REG	69 Neutral	$13.48B	34.24	5.83%	3.72%	7.39%	3.41%
VNO	66 Neutral	$8.27B	75.75	3.06%	1.87%	0.63%	258.59%
Sector *	60 Neutral	$2.81B	10.29	0.39%	8508.26%	5.90%	-17.41%
MAC	53 Neutral	$4.22B	―	-4.79%	4.24%	4.88%	-66.88%

* Real Estate Sector Average

Performance Comparison

SPG

Simon Property

165.12

25.82

18.54%

KIM

Kimco Realty

21.69

3.60

19.90%

MAC

Macerich

16.03

1.25

8.46%

REG

Regency Centers

73.82

16.17

28.05%

VNO

Vornado Realty

39.63

15.63

65.13%

BRX

Brixmor Property

26.58

5.37

25.32%

Simon Property Earnings Call Summary

Earnings Call Date:May 12, 2025

(Q1-2025)

% Change Since: -3.69%|

Next Earnings Date:Aug 04, 2025

Earnings Call Sentiment Neutral

The earnings call presented a mix of positive developments, such as increased occupancy, strong leasing activity, and a dividend hike, along with challenges including decreased funds from operation, economic uncertainties affecting sales, and non-cash losses. The highlights slightly outweigh the lowlights, with a strong emphasis on strategic growth and solid financial positioning.

Q1-2025 Updates

Positive Updates

Positive Start to Fiscal Year 2025

Simon Property Group started 2025 with results exceeding their plan, including the acquisition of The Mall Luxury Outlets in Italy and opening an outlet in Jakarta, Indonesia.

Strong Leasing Activity

Simon Property Group signed 1,500 leases for over 5.1 million square feet in the quarter, with new deals comprising 25% of this activity.

Increased Occupancy Rates

Malls and Premium outlet occupancy increased to 95.9%, up 40 basis points, while the mills occupancy increased to 98.4%, up 70 basis points compared to the prior year.

Rising Average Base Minimum Rents

Average base minimum rents for malls and outlets increased by 2.4% year-over-year, with the mills showing a 3.9% increase.

Dividend Increase

A dividend of $2.10 per share was announced for the second quarter, marking a 5% year-over-year increase.

Stable Guidance for 2025

Simon Property Group reaffirmed their full-year 2025 real estate FFO guidance range of $12.40 to $12.65 per share.

Positive Outlook on Debt Financing

Completed 12 secured loan transactions totaling approximately $2.6 billion with a strong fixed charge coverage ratio of 4.6 times.

Negative Updates

Decrease in Funds from Operation

First quarter funds from operation were $1.0 billion or $2.67 per share, down from $1.33 billion or $3.56 per share last year.

Impact of Tariffs and Economic Uncertainty

Tariffs and macroeconomic uncertainty are affecting retailer sales and could impact inventory levels, with potential effects on sales.

Non-Cash Losses and Challenges

First quarter results included a $0.17 per share loss from non-cash unrealized mark-to-market adjustments on Klepierre bonds and a $0.05 per share loss related to Catalyst Brands restructuring.

Company Guidance

During the first quarter of 2025 earnings call, Simon Property Group provided key guidance and performance metrics for the fiscal year. The company reaffirmed its full-year 2025 real estate Funds from Operations (FFO) guidance range of $12.40 to $12.65 per share, expecting results to trend towards the middle of the range due to macroeconomic uncertainties and potential impacts on retailer sales. In Q1, real estate FFO was reported at $2.95 per share, up from $2.91 the previous year, with domestic and international operations contributing $0.14 of growth driven by a 5% increase in lease income. The company signed 1,500 leases for over 5.1 million square feet, with 80% of leases expiring through 2025 already completed ahead of last year. Occupancy metrics showed positive trends, with malls and premium outlets at 95.9% and the mills at 98.4%, both showing increases compared to the prior year. Average base rents grew by 2.4% for malls and outlets, and 3.9% for mills. The quarter ended with a portfolio NOI growth of 3.6% year-over-year at constant currency. Simon Property Group's balance sheet remains robust with a net-debt to EBITDA ratio of 5.2 times and a fixed charge coverage ratio of 4.6 times. The company announced a second-quarter dividend of $2.10 per share, reflecting a 5% increase year-over-year.

Simon Property Corporate Events

Shareholder MeetingsBusiness Operations and Strategy

Simon Property Approves Redomestication to Indiana

Neutral

May 15, 2025

On May 14, 2025, Simon Property Group, Inc. held its annual shareholders meeting where several key proposals were voted on, including the election of directors and the approval of redomestication to Indiana. The redomestication, effective May 15, 2025, transitioned the company and its operating partnership from Delaware to Indiana, aligning their legal governance with their headquarters’ state. This change did not impact the company’s operations, management, or stock trading on the NYSE.

The most recent analyst rating on (SPG) stock is a Buy with a $205.00 price target. To see the full list of analyst forecasts on Simon Property stock, see the SPG Stock Forecast page.

Spark’s Take on SPG Stock

According to Spark, TipRanks’ AI Analyst, SPG is a Outperform.

Simon Property Group shows strong financial and operational performance, with robust profitability and cash flow management. Positive technical indicators and a supportive dividend yield add appeal. However, high leverage and economic uncertainties pose risks, requiring careful monitoring. The overall outlook is positive but cautious due to financial leverage concerns.

To see Spark’s full report on SPG stock, click here.

DividendsBusiness Operations and StrategyFinancial Disclosures

Simon Property Reports Strong Q1 2025 Performance

Positive

May 12, 2025

Simon Property Group reported its first quarter 2025 results, highlighting strong financial and operational performance despite a decrease in net income compared to the previous year. The company enhanced its portfolio with the acquisition of luxury outlets in Italy and the opening of Jakarta Premium Outlets in Indonesia. Simon’s net income for the quarter was impacted by an unrealized loss related to Klépierre exchangeable bonds, while its Real Estate Funds From Operations (FFO) saw a slight increase. The company also reported a rise in domestic property Net Operating Income and occupancy rates, and declared a higher quarterly dividend for its shareholders.

The most recent analyst rating on (SPG) stock is a Buy with a $205.00 price target. To see the full list of analyst forecasts on Simon Property stock, see the SPG Stock Forecast page.

Spark’s Take on SPG Stock

According to Spark, TipRanks’ AI Analyst, SPG is a Outperform.

Simon Property Group has a solid foundation of revenue growth and effective cost management. Positive technical indicators signal near-term strength, while the earnings call outlines a promising outlook with strong operational metrics and strategic developments. However, high leverage, a significant drop in net income, and potential interest rate impacts present risks. The valuation is fair but could be pressured by financial risks. Overall, SPG shows promise but requires careful monitoring of leverage and income stability.

To see Spark’s full report on SPG stock, click here.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.