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Tickers in this Article: SPG
Simon Property Group (NYSE:SPG) announced its results for the third quarter on October 25, 2012. Simon Property Group operates as a real estate investment trust that owns, develops and manages retail real estate properties.

Investors should care about a company's quarterly earnings because it shows the state of the business over the past 90 days and provides guidance for the following 90 days. SEE: Can Earnings Guidance Accurately Predict The Future?

The Numbers: Simon Property Group posted revenues above analyst predictions, though the company's EPS came up short of expectations. The company reported 84 cents per share versus the $1.92 per share estimate and revenues of $1.23 billion versus the $1.15 billion estimate. EPS fell 9.7% while revenue climbed 5.1% from the same period last year. Simon Property Group's revenue has grown during each of the past four quarters on a year-over-year basis. Simon Property Group's net income for the third quarter fell 7.2% from last year's figures to $254.9 million. With last quarter's falling profit, the company ends a run of four consecutive quarters of year-over-year profit increases.

A Look Back: Net income has increased 68.3% year-over-year on average across the last five quarters. The biggest gain came in the first quarter, when income climbed more than threefold from the year-earlier quarter.

Looking Ahead: When earnings estimates stay consistent leading up to earnings season, this usually shows analysts accurately predicted earnings estimates and business is stable. Be cautious though as this may also be a warnings sign that earnings could come at a huge surprise to the upside or downside as analyst did not correctly predict earnings. Steady earnings estimates mean there is not enough change going on with the company to make analysts change their opinions. When earning estimates are steady, investors can look at the revenue trend for a more fundamental indicator. Over the past three months, the average estimate for the fiscal year has climbed from $7.73 per to share to $7.76.

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