Investing

CEO Thomas O’Hern Backs The Macerich REIT Outlook With $200K Purchase

Shopping Center REIT Macerich (US:MAC), reported in a Form 4 filing with the US Securities & Exchange by the group’s Chief Executive Officer, Thomas O’Hern that he had purchased MAC securities on the open market over Friday and Monday.

According to the filing, O’Hern purchased 22,200 shares across two tranches with an average price of $8.983 per share for a total transaction value of  approximately $199,400.

The transaction boosts the CEO’s total share count ownership to 185,080 shares worth about $1.63 million, based on Tuesday’s closing share price of $8.79.

O’Hern began purchasing shares again in 2022, following a hiatus since March 2020.

In total, O’Hern has purchased 57,200 shares this year with his first purchase beginning in March at a security price of $14.62.

The CEO’s latest purchase follows the REIT’s weak stock price performance over 2022, with the trust trading -50% lower to date.

One benefit from the largely depressed stock price is the dividend yield which has skyrocketed to 6.5% per annum based on quarterly dividends of 15 cents per share.

While this dividend rate is significantly below the amounts paid by the REIT pre-2020, it remains attractive when compared to other yields across the market which are generally lower for North American stocks.

Aside from the CEO’s purchase, three other insider transactions were made over the course of September.

Senior Vice President and Chief Accounting Officer, Christopher Zecchini sold 2,000 MAC shares for $8.74 each and owns 9,458 shares following the transaction.

Senior Executive Vice President and Chief Legal Officer, Ann Menard purchased 2,797 shares on average at $8.94 and now owns a total of 14,494 shares following the trade.

Senior Executive Vice President of Leasing, Doug Healey purchased 2,800 shares at an average price of $8.92 and topped up his total share count to 67,796 units.

Fintel’s officer accumulation score of 84.88 is bullish on Macerich, given there have been 3 net investors buying the stock over the past 90 days. MAC ranks in the top 2% when screened against 11,539 other companies.

Macerich last updated investors when reporting second quarter results in late July. For the second quarter, MAC’s revenue declined 5.2% over the year to $204.1 million. The revenue figure was broadly in-line with analyst forecasts.

Additionally, the REIT generated positive funds from operations (FFO) per share of 46 cents, which fell from 59 cents in the year prior.

For the full year, the REIT narrowed FFO guidance where it expects to generate $1.92-2.04 per share when excluding Chandler freehold financing expenses.

Sell-side analysts remain mixed on the outlook of MAC, giving a consensus ‘hold’ recommendation with a $12 price target. The consensus target price has trended lower over the course of 2022 with the share price.

When analyzing the underlying options market trends for MAC, it is clear that market sentiment has become significantly more bullish over the last 3 months. This is explained by Fintel’s put/call ratio of 0.46 for MAC which has almost halved since June of 2022.

This ratio is calculated by assessing all disclosed open put and call interest in the market for a specific stock. A ratio skewed toward 0 suggests bullish sentiment exists in the stock with call option volume outweighing put option volume, while a number above 1 would indicate put volumes are larger than call volumes.

Macerich is next scheduled to update investors at its third quarter results expected around the beginning of November.

This article originally appeared on Fintel

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