Risk/Reward Rating: Positive
They say there are three rules in real estate: location, location, location. If this remains true, The Macerich Company (NYSE:MAC) offers an asymmetric risk/reward opportunity. The company owns arguably the highest quality portfolio in the Retail REITS industry, while trading at half the valuation of its leading peers with lower quality locations. As a result, we are adding Macerich to the dox it! list for stoxdox members.
At only 5.5x FFO (funds from operations), or cash flow in the Real Estate sector, Macerich trades at a steep discount to Simon Property Group (NYSE:SPG), which I view as an excellent comparable company. The following table compares the valuation of Macerich to Simon based on consensus FFO estimates through 2026.
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