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1. Company Snapshot

1.a. Company Description

Simon 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.

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1.b. Last Insights on SPG

Simon Property Group's recent performance is driven by strong leasing momentum, expanding mixed-use assets, and a focus on omnichannel retailing. The company reported Q2 FFO beat, driven by higher revenues and occupancy gains. Management raised guidance and increased dividend by 4.9%, now above pre-COVID levels. A recent $1.5 billion senior notes sale demonstrates access to capital markets. Rating upgrades and analyst re-evaluations reflect a more balanced outlook. With a solid portfolio and growth potential, the company is well-positioned. (Source: SPG's Q2 earnings, Aug 5)

1.c. Company Highlights

2. Simon Property Group's Q3 2025 Earnings: A Beat on Expectations

Simon Property Group's third-quarter 2025 earnings report was a resounding success, with real estate FFO per share coming in at $3.22, a significant beat on the estimated $3.09. This represented a 5.6% growth in real estate FFO, driven by an 8% increase in lease income. The company's portfolio NOI grew 5.2% for the quarter and 4.5% for the first 9 months, with the Malls and Premium Outlets ending the quarter at 96.4% occupancy, while The Mills achieved a 99.4% occupancy. Average base minimum rents increased 2.5% year-over-year for the Malls and Premium Outlets.

Publication Date: Nov -05

📋 Highlights

Operational Highlights

The company's operational performance was a key driver of the strong earnings report, with over 1,000 leases totaling approximately 4 million square feet signed during the quarter. David Simon noted that the company is still not hitting on all cylinders in terms of sales growth, but the quarter was stable, with the higher-end consumer skewing better results in the higher-income-oriented centers. The value-oriented centers were more flat to inching along, but David Simon believes there is still more juice in the value mall segment.

Acquisition of Taubman Realty Group

The acquisition of the remaining 12% interest in Taubman Realty Group was a significant development, with the company acquiring these high-quality assets at an overall cap rate of over 7.25%. David Simon mentioned that the company sees a tremendous amount of upside in the Taubman assets, with potential for operational efficiencies and improvement that could increase the yield by 50 basis points. He also noted that the company expects the cap rate to increase over time, with a potential yield of over 8%.

Valuation and Growth Prospects

With a P/E Ratio of 28.23 and an expected revenue growth rate of 3.1% next year, the company's valuation appears to be pricing in a moderate growth trajectory. The Dividend Yield of 4.63% provides a relatively attractive return for income investors. The company's ROE of 79.0% and ROIC of 10.29% suggest a strong ability to generate returns on equity and invested capital. As the company continues to focus on full-price assets and outlet acquisitions, investors will be watching to see if the company's growth prospects can justify its current valuation.

Guidance and Outlook

The company increased its full-year 2025 real estate FFO guidance range to $12.60 to $12.70 per share, reflecting a $0.15 increase at the low end and a $0.10 increase at the midpoint. Brian McDade expressed optimism about the company's ability to produce comp NOI growth in 2026, despite external factors beyond their control. The company's capital allocation priorities include dividend buybacks, development, and redevelopment, with a focus on growing their dividend and redeploying capital in the portfolio.

3. NewsRoom

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Electrify America and Simon® Collaboration Surpasses 500 Hyper-Fast Chargers

Dec -03

Source: prnewswire.com

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Autolane Secures $7.4M in Funding, Launches Curbside Operating System at Simon® Centers to Transform Retail Curbs for Autonomous Vehicle Era

Dec -03

Source: businesswire.com

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BLI Banque de Luxembourg Investments Makes New Investment in Simon Property Group, Inc. $SPG

Dec -01

Source: defenseworld.net

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Simon Property Group, Inc. $SPG Shares Acquired by Advisors Asset Management Inc.

Nov -28

Source: defenseworld.net

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B&I Capital AG Has $9.28 Million Stake in Simon Property Group, Inc. $SPG

Nov -27

Source: defenseworld.net

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American Century Companies Inc. Cuts Stock Position in Simon Property Group, Inc. $SPG

Nov -26

Source: defenseworld.net

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Holidays Start @TheMall™

Nov -24

Source: prnewswire.com

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Simon Property Acquires Philips Place in Charlotte to Boost Growth

Nov -20

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.39%)

6. Segments

Real Estate

Expected Growth: 8.5%

Simon Property Group's 8.5% growth is driven by strong occupancy rates, rent increases, and strategic acquisitions. The company's focus on experiential retail, including entertainment and dining options, enhances tenant and consumer engagement, driving foot traffic and sales. Additionally, its robust e-commerce platform and data analytics capabilities support omnichannel retail strategies, fueling growth and profitability.

ALL Other & Eliminations, Net

Expected Growth: 7.0%

The 7.0% growth in ALL Other & Eliminations, Net from Simon Property Group, Inc. is driven by increased investment income, higher rents from premium properties, and strategic acquisitions. Improved operational efficiency and effective capital management also contributed to this growth, reflecting the company's diversified portfolio and strong market presence.

7. Detailed Products

Shopping Malls

Simon Property Group operates a large portfolio of shopping malls across the United States and internationally, offering a range of retail, dining, and entertainment options.

Outlet Malls

Simon's outlet malls offer discounted prices on brand-name merchandise, attracting value-conscious shoppers.

Lifestyle Centers

Simon's lifestyle centers combine retail, dining, and entertainment options in a outdoor setting, providing a unique shopping experience.

The Mills

The Mills are a portfolio of upscale shopping centers in China, offering a range of luxury and premium retail, dining, and entertainment options.

Premium Outlet Centers

Simon's premium outlet centers offer a range of discounted luxury and brand-name merchandise, attracting high-end shoppers seeking deals.

Real Estate Investment Trust (REIT) Services

Simon Property Group offers real estate investment trust (REIT) services, providing investors with a way to invest in the company's properties and portfolios.

8. Simon Property Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Simon Property Group, Inc. operates in the real estate investment trust (REIT) sector, specifically in the mall and retail space. The threat of substitutes is relatively low because while e-commerce and online shopping are growing, they do not entirely replace the in-store experience and social interaction that malls offer. Additionally, Simon Property Group's focus on creating experiential retail environments makes substitution less likely.

Bargaining Power Of Customers

The bargaining power of customers for Simon Property Group, Inc. is moderate. While customers have a range of shopping centers to choose from, the company's malls are often premier destinations with high foot traffic and a wide range of retailers. This gives customers some leverage but also makes it essential for retailers to maintain a presence in these locations, balancing the power dynamics.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Simon Property Group, Inc. is relatively low. The company leases space to a variety of retailers, and there are many potential tenants for its malls. This abundance of potential lessees reduces the bargaining power of individual suppliers (retailers), allowing Simon Property Group to maintain favorable lease terms.

Threat Of New Entrants

The threat of new entrants for Simon Property Group, Inc. is high. While there are barriers to entry such as significant capital requirements for developing a new mall or retail space, the real estate and retail sectors are attractive. New entrants, including real estate developers and technology companies looking to create new retail experiences, could potentially disrupt the market. However, Simon Property Group's established brand and extensive portfolio provide a competitive edge.

Intensity Of Rivalry

The intensity of rivalry for Simon Property Group, Inc. is high. The retail and real estate sectors are highly competitive, with numerous players competing for market share, tenants, and customers. Simon Property Group competes with other large mall operators and retail centers, and the competition can be intense, particularly in terms of attracting and retaining top retailers and brands.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 89.39%
Debt Cost 4.28%
Equity Weight 10.61%
Equity Cost 11.28%
WACC 5.02%
Leverage 842.47%

11. Quality Control: Simon Property Group, Inc. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
CBL Properties

A-Score: 8.0/10

Value: 6.7

Growth: 8.4

Quality: 7.8

Yield: 10.0

Momentum: 7.0

Volatility: 8.3

1-Year Total Return ->

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Stock-Card
VICI Properties

A-Score: 7.6/10

Value: 5.0

Growth: 7.7

Quality: 8.1

Yield: 10.0

Momentum: 5.0

Volatility: 10.0

1-Year Total Return ->

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Alexanders

A-Score: 6.2/10

Value: 3.1

Growth: 2.9

Quality: 7.6

Yield: 10.0

Momentum: 6.0

Volatility: 7.7

1-Year Total Return ->

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Simon Property Group

A-Score: 6.1/10

Value: 2.1

Growth: 3.9

Quality: 6.5

Yield: 9.0

Momentum: 6.0

Volatility: 9.3

1-Year Total Return ->

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Realty Income

A-Score: 6.0/10

Value: 3.0

Growth: 4.2

Quality: 6.3

Yield: 8.0

Momentum: 4.5

Volatility: 10.0

1-Year Total Return ->

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Alpine Income Property Trust

A-Score: 5.6/10

Value: 4.8

Growth: 5.1

Quality: 3.2

Yield: 10.0

Momentum: 1.5

Volatility: 9.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

182.56$

Current Price

182.56$

Potential

-0.00%

Expected Cash-Flows