NEW YORK (TheStreet) -- Shares of Macerich Co. (MAC - Get Report) are down by 2.92% to $92.12 on heavy volume in mid-morning trading on Tuesday, after the mall operator rejected a $16 billion hostile bid from competitor Simon Property Group (SPG - Get Report).
Macerich announced earlier today that its board has "unanimously determined" that the unsolicited proposal from Simon Property to acquire the company for $91 per share in cash and stock "substantially undervalues Macerich and is not in the best interests of Macerich and its stockholders."
"After careful consideration, the Macerich board of directors unanimously determined that Simon Property Group's unsolicited proposal significantly undervalues Macerich and fails to reflect the full value of our portfolio of unique and irreplaceable assets and our positive growth prospects," company CEO Arthur Coppola said in a statement.
Macerich also voiced its concerns regarding Simon's plan to sell some assets to mall operator General Growth Properties (GGP), and believes that a partnership between Simon and General Growth would raise "serious anti-trust concerns."
Shares of Simon Property Group and lower by 0.13% to $186.83 this morning.
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Separately, TheStreet Ratings team rates MACERICH CO as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:
"We rate MACERICH CO (MAC) a BUY. This is driven by a number of 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. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, good cash flow from operations, solid stock price performance and compelling growth in net income. We feel these strengths outweigh the fact that the company shows low profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- MAC's revenue growth has slightly outpaced the industry average of 10.0%. Since the same quarter one year prior, revenues rose by 11.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, MACERICH CO's return on equity significantly exceeds that of both the industry average and the S&P 500.
- Powered by its strong earnings growth of 13685.71% and other important driving factors, this stock has surged by 53.59% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, MAC should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income increased by 886.5% when compared to the same quarter one year prior, rising from $144.88 million to $1,429.22 million.
- Net operating cash flow has increased to $103.80 million or 11.39% when compared to the same quarter last year. In addition, MACERICH CO has also modestly surpassed the industry average cash flow growth rate of 10.56%.
- You can view the full analysis from the report here: MAC Ratings Report