Macerich (MAC) Stock Climbs Following Q4 FFO Success Despite Revenue Shortfall

The Macerich Company, a retail real estate investment trust (REIT), saw its stock price increase by 2.1% on February 7 after surpassing the expected Funds from Operations (FFO) per share in its fourth-quarter earnings report. The company reported an FFO of 56 cents per share, excluding certain expenses, which was a slight beat over the predicted 55 cents and marked a 5.7% improvement from 53 cents in the same period of the previous year.

Growth Amid Challenges

The company registered an uptick in revenue, reaching $238.7 million compared to $228.2 million the year prior. Despite this growth, revenue fell short of the anticipated $242 million. Over the full year, Macerich achieved an FFO of $1.80 per share, exceeding the expected $1.77 but trailing behind the previous year's $1.96 figure. The annual revenue rose 2.9% to $884.1 million but still did not meet the $888.9 million consensus estimate.

Key Performance Metrics

Macerich's portfolio showed resilience, with occupancy rates improving to 93.5% from 92.6%, and signed leases for 4.2 million square feet of space, marking a 12% increase year-over-year. The base rent re-leasing spread grew by 17.2%. Furthermore, the same-center net operating income (NOI), including lease termination income, enjoyed a rise of 7.1% to reach $230.4 million.

Financial Stability and Outlook

Macerich's balance sheet reflects stability with about $657 million in liquidity, which includes available capacity on its credit line. Looking ahead, Macerich has set its 2024 FFO per share guidance in the range of $1.76 to $1.86. This forecast aligns with current expectations, indicating cautious optimism for the future.

Macerich, Stock, FFO