Simon Property Group

Methodology

This EPS-based method has fundamental limitations for Simon Property Group as a REIT, since depreciation distorts reported earnings despite cash flows from premium mall properties. Investors should use FFO or AFFO-based models instead. The quality of Class A mall locations with strong retailer demand makes cash flow valuation more straightforward than troubled mall peers.

Methodology

Traditional PEG analysis is problematic for Simon given GAAP depreciation distortions. If using PEG, substitute FFO or AFFO growth for EPS growth to get meaningful comparisons against retail REIT peers. Growth expectations should reflect rent spreads, occupancy at trophy properties, and redevelopment contributions offsetting broader mall sector challenges.

Methodology

Simon offers a substantial dividend typical of equity REITs, with the yield reflecting premium mall positioning. The dividend represents cash generation from the highest-quality mall portfolio. For retail REITs, dividend sustainability and tenant quality at Class A locations matter significantly alongside occupancy trends and rent growth.