Analyzing General Growth Properties (GGP) and Taubman Centers (TCO)
General Growth Properties (NYSE: GGP) and Taubman Centers (NYSE:TCO) are both mid-cap retail reits companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, profitability, risk, analyst recommendations, dividends, institutional ownership and valuation.
Institutional & Insider Ownership
88.7% of General Growth Properties shares are owned by institutional investors. 35.6% of General Growth Properties shares are owned by company insiders. Comparatively, 31.2% of Taubman Centers shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
This is a summary of current ratings and recommmendations for General Growth Properties and Taubman Centers, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|General Growth Properties||1||5||6||0||2.42|
General Growth Properties currently has a consensus target price of $25.50, suggesting a potential upside of 6.92%. Taubman Centers has a consensus target price of $66.17, suggesting a potential upside of 18.41%. Given Taubman Centers’ higher possible upside, analysts plainly believe Taubman Centers is more favorable than General Growth Properties.
General Growth Properties pays an annual dividend of $0.88 per share and has a dividend yield of 3.7%. Taubman Centers pays an annual dividend of $2.50 per share and has a dividend yield of 4.5%. General Growth Properties pays out 123.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Taubman Centers pays out 238.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. General Growth Properties has raised its dividend for 7 consecutive years and Taubman Centers has raised its dividend for 5 consecutive years.
This table compares General Growth Properties and Taubman Centers’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|General Growth Properties||29.96%||8.34%||3.05%|
Valuation & Earnings
This table compares General Growth Properties and Taubman Centers’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|General Growth Properties||$2.35 billion||9.62||$1.29 billion||$0.71||33.59|
|Taubman Centers||$612.56 million||5.54||$132.61 million||$1.05||53.22|
General Growth Properties has higher revenue and earnings than Taubman Centers. General Growth Properties is trading at a lower price-to-earnings ratio than Taubman Centers, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
General Growth Properties has a beta of 0.79, indicating that its stock price is 21% less volatile than the S&P 500. Comparatively, Taubman Centers has a beta of 0.52, indicating that its stock price is 48% less volatile than the S&P 500.
General Growth Properties beats Taubman Centers on 13 of the 17 factors compared between the two stocks.
General Growth Properties Company Profile
GGP Inc. (GGP), formerly General Growth Properties, Inc., is a self-administered and self-managed real estate investment trust (REIT). The Company operates as a holding company, which is engaged in the operation, development and management of retail and other rental properties, primarily regional malls. As of December 31, 2016, the Company owned, either entirely or with joint venture partners, 127 retail properties located throughout the United States comprising approximately 125 million square feet of gross leasable area (GLA). As of December 31, 2016, the Company’s retail properties included 200 Lafayette, The Shoppes at Buckland Hills, Northridge Fashion Center, Brass Mill Center, Jordan Creek Town Center, Westroads Mall and Stonestown Galleria. The Company’s business is conducted through GGP Operating Partnership, LP (GGPOP), GGP Nimbus, LP (GGPN) and GGP Limited Partnership (GGPLP, and together with GGPN and GGPOP, the Operating Partnerships), subsidiaries of GGP.
Taubman Centers Company Profile
Taubman Centers, Inc. is a self-administered and self-managed real estate investment trust (REIT). The Company’s segment is focused on owning, developing and managing regional shopping centers. The Taubman Realty Group Limited Partnership (the Operating Partnership or TRG) is majority-owned partnership subsidiary of the Company that owns direct or indirect interests in all of its real estate properties. The Company owns, leases, acquires, disposes of, develops, expands and manages regional and super-regional shopping centers and interests therein. Its owned portfolio of operating centers as of December 31, 2016 consisted of 23 urban and suburban shopping centers operating in 11 the United States states, Puerto Rico, South Korea, and China. The consolidated businesses consist of shopping centers and entities that are controlled by ownership or contractual agreements, The Taubman Company LLC (Manager), and Taubman Properties Asia LLC and its subsidiaries (Taubman Asia).
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