NEW YORK (TheStreet) -- Shares of Macerich Co. (MAC - Get Report) are down by 4.84% to $80.25 in pre-market trading on Wednesday morning, after the mall operator rejected the second unsolicited merger proposal from competitor Simon Property Group (SPG).
On Tuesday afternoon Macerich released a statement saying that its board of directors had unanimously voted to reject Simon's revised bid to acquire the company for $95.50 per share, or $23.2 billion (including debt) in cash and stock.
"Our board carefully reviewed Simon Property Group's revised proposal and concluded that it does not reflect the full value of our company," Arthur Coppola, Macerich CEO said in the statement.
"Simon's proposal has shined a bright light on the value of Macerich and our unparalleled collection of assets in the most desirable and highest barrier-to-entry markets. We have a long-term successful track record and a strategy that positions Macerich as the premier, pure-play high-end mall REIT with numerous embedded opportunities for future value creation and significant upside potential," Coppola continued.
As a result of Macerich's rejection Simon Property said it has withdrawn its offer to acquire the company "in light of the decision by the Macerich board of directors not to engage in discussions with Simon."
Simon Property shares closed at $195.64 on Tuesday afternoon.
Separately, TheStreet Ratings team rates MACERICH CO as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate MACERICH CO (MAC) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, solid stock price performance, compelling growth in net income and good cash flow from operations. 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 10.1%. 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 43.42% 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. Despite an increase in cash flow, MACERICH CO's average is still marginally south of the industry average growth rate of 13.05%.
- You can view the full analysis from the report here: MAC Ratings Report