for the newbies: POMO = Pleasure of Missing Out aka you are happy market (or a stock) is down because you are in cash, etc…
KC - regarding SPG:
My caveat is “I don’t know what the market thinks is a good price right now. For anything.”
As far as their recent ER/CC, it is here;
https://www.fool.com/earnings/call-transcripts/2022/05/10/si…
CEO David Simon is a stud.
Business was going very well. He argued they are traditionally 15x FFO or something like that, and yet they are only 10 or 12 at moment. Point is, he was saying they are undervalued.
All their acquisitions doing well (JCPennys, joint vehicle SPARC with Authentic Brands, etc)
Leasing had never been stronger. This makes sense because the weak had already been weeded out with covid, right? Every tenant left standing WANTS to be there.
They raised divvy, again.
They raised forecast. (in this environment, impressive)
Could the price go to $90? To $80s? Dunno. I feel like, if this recession/downturn/bear ends before EOY, that their price will be at or above current price, so I feel it would only be paper losses with dividends along the way. I would be annoyed that I could have gotten in cheaper, but I may pare some of the stock after the ex-div date coming up, IF we catch a good bear market rally, but currently the stock is going against me, so I probably just hold.
Keep in mind that in previous economic downturns (GFC and Covid) their stock collapsed. Both times rebounded hard. Of course, covid was unique with indoor closures/masks. Covid could still be a wild card this coming Winter. Which is why I may unload some before Summer ends. If I want two dividend payouts, I probably have to hold thru early Sept is my guess. That could be a confluence of both market upturn and covid upturn…so who knows.
Anyway, some excerpt…good luck!
"
The number of tenant terminations in the first quarter was the lowest recorded in the last five years. And our TRG portfolio occupancy was 93.2% at quarter-end, average base minimum rent increased compared to the fourth quarter and was $54.14. Leasing momentum continued across the portfolio. We signed more than 900 leases for more than 3 million square feet in the quarter and had a significant number of leases in our pipeline.
n fact, at our recent leasing deal committee, we approved the most deals since 2016 and overall, we recently have approved approximately 500 new deals representing 2 million square feet. Demand is very strong and interesting with the volatility of the world, our portfolio in the U.S. is in great demand from worldwide brands, restaurants, and entertainment operators, as most retailers and tenants view the U.S. as the place to be.
Sales momentum continued for our retailers, mall sales volume for the first quarter were up 19% year over year, we reported retail sales per square foot reached another record in the first quarter at $734 per square foot, for the mall and outlet combined 43% increase and 669 per square foot for the Mills, which was a 50% increase. TRG reported 1,038 per square foot, which was a 52% year-over-year increase. Our occupancy cost is the lowest that we’ve had in seven years. We are pleased with the results of our other platform investments in the first quarter, including SPARC Group and JCPenney.
JCPenney’s liquidity position is strong at $1.3 billion and it has no borrowings on its line of credit and performed better than planned. I can say the same for SPARC, which also performed better than planned in the quarter. SPARC also completed the U.S. Reebok transaction, and we anticipate great things from this iconic brand.
When we look at the valuation of our stock today at an FFO multiple of approximately 10 times relative to the historical valuations closer to 15 times, and an applied cap rate of around 7% for our real estate assets, we see substantial value in our stock, particularly given our belief and conviction in our future growth opportunities. Our balance sheet is strong, continues to be a significant advantage for us while our cash flow generation provides us with the flexibility to adapt as conditions warrant and as we have proved countless times. We will be thoughtful and opportunistic on the buyback and keep in mind, this is in addition to the more than 20% increase in our dividend we announced today. Now, given our outlook for the remainder of the year, we are increasing our full year 2022 comparable FFO guidance from $11.50 to $11.70 per share to $11.60 to $11.75 per share, which compares to our comparable number of $11.44 last year.
This is an increase of $0.10 at the bottom end of the range and $0.05 at the top or an 8% increase at the midpoint. This does not include the previously mentioned unrealized loss or gain that may occur the rest of the year on our fair value of investments that I mentioned and please keep in mind that this guidance increase comes in the face of a strong U.S. dollar and rising interest rates.
We also announced today that our board of directors has authorized a new common stock repurchase program for up to $2 billion that will become effective on May 16.
Dreamer