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"We rate MACERICH CO (MAC) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. Among the primary strengths of the company is its solid stock price performance. We feel these strengths outweigh the fact that the company has had somewhat weak growth in earnings per share."
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Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Compared to its closing price of one year ago, MAC's share price has jumped by 38.74%, exceeding the performance of the broader market during that same time frame. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- MAC, with its decline in revenue, underperformed when compared the industry average of 13.8%. Since the same quarter one year prior, revenues slightly dropped by 4.5%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market on the basis of return on equity, MACERICH CO underperformed against that of the industry average and is significantly less than that of the S&P 500.
- The gross profit margin for MACERICH CO is currently lower than what is desirable, coming in at 27.43%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 12.90% significantly trails the industry average.
- Net operating cash flow has decreased to $106.33 million or 27.20% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
- You can view the full analysis from the report here: MAC Ratings Report