Unrecognized Quality Presents 48% Upside At Brixmor Properties
Dane Bowler • 14 Comments
Dane Bowler • 14 Comments
Thu, Jun. 9, 11:52 AM
- The team hosted meetings with 29 companies over two days across six subsectors. Some highlights:
- Lodging: Business travel remains soft and most are operating defensively by grouping up and reducing leverage. NYC is flooded with hotels available for sale which should pressure pricing.
- Apartments: The slowdown in NoCal is concentrated in Soma and San Jose, but expected to be temporary. The NYC slowdown is expected to endure through 2017. Merchant builders in Houston with deliveries in 2017 are in trouble - an opportunity for Camden Property Trust (NYSE:CPT) to pick up assets on the cheap.
- Malls: Concerns over department stores are overblown. Simon Property (NYSE:SPG) expects spreads to top mid-teens in the next five years. Omni-channel retail strategy is growing increasingly important as the WSJ reports 80% of online sales touch brick and mortar in some way.
- CS's Ian Weissman is ranked #1,134 out of #3,990 analysts on TipRanks.com.
- Tickers of interest: HPT, SHO, LHO, PEB, CHSP, INN, RLJ, EQR, AVB, ESS, PPS, UDR, AIV, GGP, BRX, KIM, WRI, MAC
Fri, Jun. 3, 3:22 PM
- "Audited financials have been filed with no restatements, the open CEO and CFO roles have been filled with industry veterans, and the company has successfully demonstrated that Brixmor (BRX +1.2%) stock and bonds could be sold into the market," says analyst Michael Mueller, upgrading to Neutral from Underweight.
- New CEO James Taylor will be at the NAREIT conference next week, and Mueller expects his message to be that the company is well-positioned to move forward.
- The accounting issues came to light in early February, knocking the stock from nearly $27 all the way to about $20. It's since recovered to $25.92 currently.
Wed, Apr. 27, 10:58 AM
Tue, Apr. 26, 4:22 PM
Mon, Apr. 25, 5:35 PM
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Mon, Apr. 25, 9:44 AM
- Being mulled by owners of shopping centers/malls this morning is new research from Green Street Advisors suggesting department stores need to close about 800 locations, or 20% of all anchor space in U.S. malls.
- Sears alone would need to close 43% of its stores to get inflation adjusted sales per square foot back to 2006 levels. Of course, retailers like Sears, Macy's, and J.C. Penney have already closed hundreds of spots over the past few years.
- The Green Street study says sales per square foot of $165 last year were down 24% from 2006, while physical footprints are off just 7%.
- Department stores may not agree. J.C. Penney CFO has said that when the company closes a store - particularly in a small market - dot.com business also goes down.
- Watching with interest: RPAI, IRC, KIM, FRT, DDR, EQY, CBL, SPG, GGP, BRX, WRI, PEI
Thu, Apr. 14, 12:26 PM
- "Quality trumps value," says analyst Haendel St. Juste initiating coverage on ten retail REITs. Mall REITs are already up 5% YTD, and shopping centers up 7%. St. Juste and team think there's another 10% upside.
- Four of the ten names are Buy-rated: American Assets Trust (AAT -0.2%), General Growth Properties (GGP -0.2%), Simon Property Group (SPG -0.1%), and Taubman Centers (TCO +0.2%).
- Neutral rated: Brixmor (BRX -0.1%), CBL & Associates (CBL -0.9%), DDR (DDR +0.4%), Federal Realty (FRT -0.3%), Kimco (KIM -0.5%), and Macerich (MAC -0.4%).
- St. Juste: "Our stock picks have a pronounced bias toward higher productivity platforms, a somewhat consensus view, but an appropriate one given the current environment and prevailing valuations."
- Now read: Red Flags For Sears Pensioners (April 14)
Tue, Apr. 12, 8:56 AM| Tue, Apr. 12, 8:56 AM
Mon, Feb. 29, 5:50 PM
Mon, Feb. 29, 4:44 PM
- Q4 FFO of $155.8M or $0.51 per share is inline with consensus. One year ago, FFO in Q4 was $131.5M or $0.43 per share, though the figures aren't necessarily compatible.
- Same-property NOI in 2015 gained 3.2% Y/Y.
- Full-year 2016 FFO guidance of $2.01-$2.09 per share vs. $1.97 earned in 2015. Same-property NOI growth of 2.5-3.5% vs. 3.2% in 2015.
- Conference call tomorrow at 8:30 ET
- Source: Press Release
- BRX flat after hours
Sun, Feb. 28, 5:35 PM
Thu, Feb. 11, 1:23 PM
- “There was no target, no bonus, no compensation directly related to same-[property] NOI,” said audit committee Chairman Michael Berman on a Monday conference call when asked by Sandler O'Neill analyst Alex Goldfarb if same-property NOI (the measure that was fiddled with) was tied to compensation.
- In the most narrow sense, what Berman says was true, but a measure called cash NOI is used to trigger incentive bonuses, writes Francine McKenna, and the three axed executives were awarded payouts for exactly meeting the targeted $2.79 per share in 2014.
- "This is the first case that I’ve seen where an accounting issue is supposedly immaterial to GAAP [and] is potentially material to the non-GAAP results,” says Olga Usvyatsky of Audit Analytics.
- Previously: Brixmor CEO Carroll, CFO Pappagallo resign over accounting allegations (Feb. 8)
- BRX +0.5% today
Mon, Feb. 8, 12:59 PM
- Brixmor Property Group (BRX -19.9%) gets triple blow from Boenning Scattergood, JPMorgan Chase & Co. and Stifel Nicolaus over accounting allegations.
- Boenning Scattergood downgrades Brixmor Property Group to neutral from outperfom, JPMorgan Chase & Co. to underweight from overweight, Stifle Nicolaus to hold from buy.
Mon, Feb. 8, 9:19 AM
Mon, Feb. 8, 8:41 AM
- Brixmor Property (NYSE:BRX) says CEO Michael Carroll, President and CFO Michael Pappagallo, and Chief Accounting Officer Steven Splain have resigned, effective immediately, and names Daniel Hurwitz as interim CEO.
- The resignations follow an unfavorable audit committee review of the company's non-GAAP reporting measure, which led the board to conclude that specific accounting and financial reporting personnel were "smoothing income items, both up and down," to show consistent quarterly same property net operating income growth; the company does not believe the amounts involved were material to financial results, and does not believe it will be required to restate historical financial results.
- BRX says it is rescheduling its Q4 earnings announcement, originally scheduled for today, for Feb. 29; it also says it expects to meet its previously announced guidance for 2015 FFO of $1.96-$1.98, and declares a $0.245/share quarterly dividend, unchanged from the previous quarter.
Sun, Feb. 7, 5:35 PM
Brixmor Property Group, Inc. owns and operates wholly owned portfolio of grocery anchored community and neighborhood shopping centers in the United States. The company was founded on May 27, 2011 and is headquartered in New York, NY.
Industry: REIT - Retail
Country: United States
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