Rating Change #6

General Growth Properties Inc ( GGP) has been downgraded by TheStreet Ratings from hold to sell. The company's weaknesses can be seen in multiple areas, such as its generally weak debt management and poor profit margins.

Highlights from the ratings report include:
  • The debt-to-equity ratio is very high at 2.04 and currently higher than the industry average, implying that there is very poor management of debt levels within the company.
  • The gross profit margin for GENERAL GROWTH PPTYS INC is rather low; currently it is at 21.10%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -50.70% is significantly below that of the industry average.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, GENERAL GROWTH PPTYS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Real Estate Investment Trusts (REITs) industry average, but is greater than that of the S&P 500. The net income increased by 67.8% when compared to the same quarter one year prior, rising from -$1,142.92 million to -$367.84 million.
  • GGP's revenue growth trails the industry average of 17.1%. Since the same quarter one year prior, revenues slightly increased by 6.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
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General Growth Properties, Inc. operates as a real estate investment trust in the United States. It operates in two segments, Retail and Other, and Master Planned Communities. General Growth has a market cap of $15.6 billion and is part of the financial sector and real estate industry. Shares are up 17.1% year to date as of the close of trading on Wednesday.

You can view the full General Growth Ratings Report or get investment ideas from our investment research center.

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