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On Tuesday, Truist Securities expressed continued confidence in The Macerich Company (NYSE:MAC), maintaining a Buy rating and a $19.00 price target on the stock. Currently trading at $16.54 with a market capitalization of $4.36 billion, MAC has seen an impressive 11.53% return over the past week. The endorsement follows a report highlighting the company’s strong performance in the first quarter of 2025, which included a significant increase in leasing activity and growth in base minimum rents. According to InvestingPro data, analyst targets for the stock range from $13.70 to $25.00, with additional insights available in the comprehensive Pro Research Report.
The Macerich Company, a real estate investment trust that owns shopping centers, reported a robust first quarter with 2.6 million square feet of leases signed, marking a 156% increase compared to the same period last year. Most of these contracts were renewals, totaling approximately 2.3 million square feet. This leasing momentum indicates a positive trend in the company’s operations, supported by a 12.02% revenue growth over the last twelve months. The company has maintained its dividend payments for 32 consecutive years, currently offering a 4.11% yield.
Additionally, the company’s Signed not yet open (SNO) pipeline, which represents future revenue from leases signed but not yet operational, increased to $80 million, up from $66 million in the fourth quarter of 2024. This growth suggests a solid foundation for future earnings.
Despite a 1.5% drop in occupancy, base minimum rents saw an uptick, reaching $160 million in the first quarter of 2025. This figure includes a substantial $5 million termination fee and exceeds both the previous quarter’s rents of $159 million and Truist Securities’ estimate of $156 million, excluding the impact of lease termination fees.
Funds from operations (FFO) per share also met the optimistic expectations set by Truist Securities, coming in at $0.33 per share. This performance surpassed the consensus estimate of $0.31 per share, marking another positive indicator for the company’s financial health.
The Macerich Company’s recent achievements underscore its ability to navigate the challenges of the retail real estate market effectively. With a strong leasing pipeline and improved financial metrics, the company continues to attract positive attention from industry analysts. InvestingPro analysis suggests the stock is currently trading above its Fair Value, with 8 additional ProTips and extensive financial metrics available to subscribers, helping investors make more informed decisions about this retail REIT.
In other recent news, Macerich Company reported its Q1 2025 financial results, showing a mixed performance. The company posted an earnings per share (EPS) of -$0.20, which was below the anticipated -$0.0747, indicating a larger-than-expected loss. However, Macerich’s revenue reached $249.22 million, surpassing the forecasted $206.71 million, highlighting strong revenue generation despite the earnings shortfall. The company also reported funds from operations (FFO) of $87 million, or $0.33 per share, up from $75 million in the same quarter last year, driven by increased leasing revenues.
Macerich is actively engaged in strategic redevelopment projects and tenant expansion, contributing to its revenue growth and positive investor sentiment. The company is focused on reducing its net debt to EBITDA ratio from 7.9x to a target of low-to-mid 6x. Despite ongoing challenges with occupancy, which slightly declined to 92.6%, Macerich is making significant progress in its leasing activities, having signed 2.6 million square feet of leases in Q1 2025. The company anticipates continued growth, projecting positive earnings by Q4 2025 and aiming for same-store net operating income (NOI) growth of 3-4% in 2026.
Analysts from Truist and Jefferies have noted Macerich’s strong leasing progress and strategic initiatives, which are critical to its path forward plan. The company is also on track with its asset disposition strategy, having completed sales totaling over $1.1 billion and identifying additional assets for sale or giveback. Macerich’s strategic focus remains on enhancing its retail centers to drive long-term value for shareholders.
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