Skip to main content

Market Overview

Morgan Stanley Upgrades Simon Property Group On Potential Earnings Recovery

Morgan Stanley Upgrades Simon Property Group On Potential Earnings Recovery

While the retail REITs segment faces increasing secular challenges, Simon Property Group Inc (NYSE: SPG) has multiple drivers of earnings growth, according to Morgan Stanley.

The Simon Property Group Analyst: Richard Hill upgraded Simon Property Group from Equal-Weight to Overweight, while raising the price target to $125.

The Simon Property Group Thesis: The company’s earnings seem to have bottomed out in 2020, with a majority of the earnings decline being driven by rent abatements, Hill said in the note. He mentioned four drivers for Simon Property Group’s earnings ahead:

  • Potential recovery of abatements, estimated at a recovery of $410 million.
  • The closing of the TCO acquisition and improved retailer negotiating leverage, estimated to contribute $360 million.
  • Between $55 million and $75 million from retailer investments
  • “$60mn from $800mn of re/development,” the analyst wrote.

“We model +6.1% FFO growth in '21e as total NOI growth (including TCO) rebounds to +9.5%. Importantly, we do not assume $410mn of abatements are recovered, which suggest significant potential upside,” Hill added.

SPG Price Action: Shares of Simon Property Group had risen by 3.31% to $109.75 on Thursday.

(Photo by freestocks on Unsplash)

Latest Ratings for SPG

Apr 2021Morgan StanleyMaintainsOverweight
Mar 2021Piper SandlerMaintainsOverweight
Feb 2021Deutsche BankMaintainsBuy

View More Analyst Ratings for SPG
View the Latest Analyst Ratings


Related Articles (SPG)

View Comments and Join the Discussion!

Posted-In: Morgan Stanley Richard HillAnalyst Color REIT Upgrades Price Target Analyst Ratings Real Estate Best of Benzinga

Latest Ratings

GDWolfe ResearchDowngrades
QRTEAB of A SecuritiesInitiates Coverage On
ABB of A SecuritiesDowngrades42.0
VCTRB of A SecuritiesUpgrades32.0
BSIGB of A SecuritiesUpgrades27.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at