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Regency Centers Corp REG

Morningstar Rating
$60.97 +0.44 (0.73%)
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Company Report

Regency Centers Earnings: Accelerating Expense Growth, Slow Same-Store NOI Growth

Regency Centers reported fourth-quarter results that were slightly below our estimates, but we don’t see anything in the quarter that would materially change our $76 fair value estimate for the no-moat company. Same-store occupancy improved 30 basis points sequentially to 94.7%, relatively in line with our 94.8% estimate. Re-leasing spreads were very strong at 11.7% in the fourth quarter, better than our estimate of new rents being 8.8% higher than expiring rents. As a result, base rent increased 3.2% and same-store revenue rose 3.6% in the quarter. However, same-store expense growth continues to accelerate and rose 10.2%, leading to same-store net income growth of just 0.8% that was slightly below our estimate of 1.5% growth. Regency reported core funds from operations, or FFO, of $0.99 per share for the fourth quarter, which was a penny below our $1.00 estimate.

Price vs Fair Value

REG is trading at a 20% discount.
Price
$60.97
Fair Value
$25.00
Uncertainty
Medium
1-Star Price
$752.20
5-Star Price
$95.40
Economic Moat
Xvxpr
Capital Allocation
Nyskvrds

Bulls Say, Bears Say

Bulls

With over 80% of the portfolio featuring a grocery anchor and with the average grocery anchor in the portfolio producing sales per square foot significantly higher than the national average, Regency's portfolio has a strong driver of foot traffic to its locations that should remain relatively resistant to e-commerce pressures.

Bears

Shifts in consumer behavior, greater adoption of e-commerce, and technological advances could significantly disrupt tenant profitability, affecting property performance.

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News

Trading Information

Previous Close Price
$60.53
Day Range
$60.0161.00
52-Week Range
$54.7268.47
Bid/Ask
$59.85 / $66.63
Market Cap
$11.25 Bil
Volume/Avg
875,190 / 1.2 Mil

Key Statistics

Price/Earnings (Normalized)
29.69
Price/Sales
8.13
Dividend Yield (Trailing)
4.30%
Dividend Yield (Forward)
4.40%
Total Yield
4.54%

Company Profile

Regency Centers is the largest shopping center-focused retail REIT. The company's portfolio includes an interest in 480 properties, which includes nearly 57 million square feet of retail space following the completion of the Urstadt Biddle acquisition in August 2023. The portfolio is geographically diversified with 22 regional offices and no single market representing more than 14% of total company net operating income. Regency's retail portfolio is primarily composed of grocery-anchored centers, with 80% of properties featuring a grocery anchor and grocery stores representing 20% of annual base rent.
Sector
Real Estate
Industry
REIT - Retail
Stock Style Box
Mid Core
Total Number of Employees
497

Competitors

Valuation

Metric
REG
FRT
KIM
Price/Earnings (Normalized)
29.6937.4332.28
Price/Book Value
1.652.911.28
Price/Sales
8.137.096.80
Price/Cash Flow
14.5914.5111.37
Price/Earnings
REG
FRT
KIM

Financial Strength

Metric
REG
FRT
KIM
Quick Ratio
0.591.556.40
Current Ratio
0.641.556.42
Interest Coverage
3.372.453.57
Quick Ratio
REG
FRT
KIM

Profitability

Metric
REG
FRT
KIM
Return on Assets (Normalized)
3.33%3.11%3.92%
Return on Equity (Normalized)
6.00%9.35%7.37%
Return on Invested Capital (Normalized)
4.71%4.99%4.41%
Return on Assets
REG
FRT
KIM
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