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04/28/2020

Mall stocks rise on first day of trading this week

PREIT and Macerich's Fashion District Philadelphia
PREIT and Macerich's Fashion District Philadelphia

The stocks of leading REITs including PREIT, Macerich, Tanger, and Simon all rose when the market opened on Monday. How could that be?

As states like Texas and Georgia easing non-essential retailers back into business, some investors interpreted it as a sign that perhaps the worst was over for big mall owners, according to an analysis in The Motley Fool.

But the investment site still saw tough times ahead for the retail sector.

“These remain very volatile times for mall REITs, so any gains could be just as easily lost on dour COVID-19 related news. Moreover, with earnings season only just starting, the real impact from COVID-19 on mall REIT finances still isn't clear, though it will clearly be bad,” wrote analyst Reuben Gregg Brewer.

Brewer added that mall owners with solid properties like Simon and Macerich are likely to survive, but that all still faced uncertainty in the near term.