Simon Property Group (SPG) vs. Brixmor Property Group (BRX) Financial Analysis

Brixmor Property Group (NYSE: BRX) and Simon Property Group (NYSE:SPG) are both mid-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, dividends, earnings, risk, analyst recommendations, valuation and profitability.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Brixmor Property Group and Simon Property Group, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Brixmor Property Group 0 5 6 0 2.55
Simon Property Group 0 5 9 0 2.64

Brixmor Property Group currently has a consensus target price of $25.39, suggesting a potential upside of 35.48%. Simon Property Group has a consensus target price of $195.85, suggesting a potential upside of 27.52%. Given Brixmor Property Group’s higher probable upside, equities analysts clearly believe Brixmor Property Group is more favorable than Simon Property Group.

Profitability

This table compares Brixmor Property Group and Simon Property Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Brixmor Property Group 23.06% 10.22% 3.19%
Simon Property Group 32.07% 39.29% 6.03%

Institutional and Insider Ownership

95.8% of Simon Property Group shares are held by institutional investors. 0.3% of Brixmor Property Group shares are held by insiders. Comparatively, 8.4% of Simon Property Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Dividends

Brixmor Property Group pays an annual dividend of $1.04 per share and has a dividend yield of 5.5%. Simon Property Group pays an annual dividend of $7.20 per share and has a dividend yield of 4.7%. Brixmor Property Group pays out 106.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Simon Property Group pays out 127.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Brixmor Property Group has increased its dividend for 7 consecutive years. Brixmor Property Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk & Volatility

Brixmor Property Group has a beta of 0.53, suggesting that its stock price is 47% less volatile than the S&P 500. Comparatively, Simon Property Group has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500.

Earnings & Valuation

This table compares Brixmor Property Group and Simon Property Group’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Brixmor Property Group $1.29 billion 4.43 $840.64 million $0.98 19.12
Simon Property Group $5.49 billion 8.70 $4.02 billion $5.63 27.28

Simon Property Group has higher revenue and earnings than Brixmor Property Group. Brixmor Property Group is trading at a lower price-to-earnings ratio than Simon Property Group, indicating that it is currently the more affordable of the two stocks.

Summary

Simon Property Group beats Brixmor Property Group on 13 of the 17 factors compared between the two stocks.

About Brixmor Property Group

Brixmor Property Group Inc. is an internally managed real estate investment trust. The Company conducts its operations primarily through Brixmor Operating Partnership LP and subsidiaries (collectively, the Operating Partnership). As of December 31, 2016, it owned interests in 512 shopping centers (the Portfolio) with approximately 86 million square feet of gross leasable area (GLA), including 511 shopping centers and one shopping center held through an unconsolidated joint venture. With an average shopping center size of 167,982 square feet as of December 31, 2016, the Company’s portfolio consisted predominantly of community and neighborhood shopping centers. As of December 31, 2016, the Company’s properties were located in various states of the United States, such as Texas, Florida, California, New York, Illinois, Georgia, New Jersey, Ohio, North Carolina, Michigan, Connecticut, Tennessee, Kentucky, Colorado, Arizona, Delaware, West Virginia, Vermont, Maine, Oklahoma and New Mexico.

About Simon Property Group

Simon Property Group, Inc. is a self-administered and self-managed real estate investment trust (REIT). The Company owns, develops and manages retail real estate properties, which consist primarily of malls, Premium Outlets and The Mills. Simon Property Group, L.P. (Operating Partnership), is the Company’s partnership subsidiary that owns all of its real estate properties and other assets. As of December 31, 2016, the Company owned or held an interest in 206 income-producing properties in the United States, which consisted of 108 malls, 67 Premium Outlets, 14 Mills, four lifestyle centers, and 13 other retail properties in 37 states and Puerto Rico. As of December 31, 2016, it had redevelopment and expansion projects, including the addition of anchors, big box tenants, and restaurants, underway at 27 properties in the United States and it had one outlet and one other retail project under development.

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