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Tickers in this Article: SPG
Simon Property Group (NYSE:SPG) will release its third quarter results on Thursday, October 25, 2012. Analysts are expecting the company to report a profit of $1.92 a share, up from $1.71 a year ago.

Investors care about earnings because they drive stock prices. Strong earnings generally result in the stock price moving up and vice versa. SEE: Surprising Earnings Results

What to Expect: Simon Property Group is expected to report $1.92 per share, up 12.3% from a year ago when the company reported earnings of $1.71 per share.

After rising from $1.88 three months ago, the consensus estimate has remained unchanged in the last month. Analysts are projecting earnings of $7.75 per share for the fiscal year.

Simon Property Group is expected to beat last year's reported revenue of $1.17 billion and come in at $1.19 billion for the quarter. The anticipated revenue for the fiscal year is $4.75 billion.

Company Performance: These last four quarters have marked revenue growth. It rose 13.8% in the second quarter, 58.5% in the first quarter, 24.2% in the fourth quarter of the last fiscal year and 5.2% in the third quarter of the last fiscal year.

Compared to the industry average of 16.82, SPG's P/E ratio of 30.3 is quite high. Generally speaking, the higher the P/E ratio, the higher the market expectations for a company's future performance. The P/E ratio has been used for ages by analysts and still remains one of the most relevant pieces of stock valuation. A high or low P/E ratio is not good or bad in and of itself, but a company trading with a high P/E ratio must continue to post strong financial performance or its stock price is likely to fall. SEE: Investment Valuation Ratios: Price/Earnings Ratio

Since July 24, 2012, the stock price has fallen 2.6% to $153.54 from $157.60. September 19, 2012 to September 20, 2012 marked one of Simon Property Group's worst periods, as the share price fell $4.78.

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