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The Macerich Company Just Missed Earnings - But Analysts Have Updated Their Models

Investors in The Macerich Company (NYSE:MAC) had a good week, as its shares rose 3.7% to close at US$16.14 following the release of its yearly results. Results were mixed, with revenues of US$863m exceeding expectations, even as statutory earnings per share (EPS) fell badly short. Earnings were US$0.07 per share, -25% short of analyst expectations. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Macerich

earnings-and-revenue-growth
earnings-and-revenue-growth

Taking into account the latest results, Macerich's eight analysts currently expect revenues in 2022 to be US$869.5m, approximately in line with the last 12 months. Statutory earnings per share are predicted to jump 80% to US$0.12. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$812.8m and losses of US$0.069 per share in 2022. So we can see there's been a pretty clear upgrade to expectations following the latest results, with a small lift in revenues expected to lead to profitability earlier than previously forecast.

As a result, it might be a surprise to see thatthe analysts have cut their price target 5.2% to US$20.48, which could suggest the forecast improvement in performance is not expected to last. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Macerich, with the most bullish analyst valuing it at US$30.00 and the most bearish at US$14.50 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's also worth noting that the years of declining sales look to have come to an end, with the forecast for flat revenues to the end of 2022. Historically, Macerich's sales have shrunk approximately 7.0% annually over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 7.9% per year. Although Macerich's revenues are expected to improve, it seems that it is still expected to grow slower than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts now expect Macerich to become profitable next year, compared to previous expectations that it would report a loss. Fortunately, they also upgraded their revenue estimates, although our data indicates sales are expected to perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Macerich going out to 2024, and you can see them free on our platform here..

You still need to take note of risks, for example - Macerich has 5 warning signs (and 1 which is a bit concerning) we think you should know about.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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