Regency Centers Corporation (REG), headquartered in Jacksonville, Florida, is a real estate investment trust (REIT) that owns, operates, and develops shopping centers situated in suburban areas with compelling demographics. Valued at $13.5 billion by market cap, its portfolio includes properties that are strategically merchandised to feature highly productive grocers, restaurants, service providers, and best-in-class retailers.
Companies worth $10 billion or more are generally described as “large-cap stocks,” and REG definitely fits that description, with its market cap exceeding this threshold, reflecting its substantial size, influence, and dominance in the REIT - retail industry. REG's strategic focus on prime locations, particularly shopping centers anchored by grocery stores in affluent and high-traffic areas and on well-maintained properties occupied by various local and global tenants, helps it to compete effectively in the industry.
Despite its notable strength, REG slipped 2.5% from its 52-week high of $76.53, achieved on Nov. 29. Over the past three months, REG stock rose 5.2%, outperforming the Real Estate Select Sector SPDR Fund’s (XLRE) 7.6% losses during the same time frame.
In the longer term, shares of REG rose 21.5% over the past six months and climbed 11% over the past 52 weeks, outperforming XLRE’s six-month gains of 8.2% and 2.1% returns over the last year.
To confirm the bullish trend, REG has been trading above its 200-day moving average since early June, with slight fluctuations. The stock is trading above its 50-day moving average since mid-May, with some fluctuations.
REG’s outperformance can be credited to solid tenant demand for its grocery-anchored shopping centers, which has accelerated its organic growth and expanded investment opportunities.
On Oct. 28, REG shares closed up more than 1% after reporting its Q3 results. The company’s revenue of $360.3 million exceeded Wall Street forecasts of $355.2 million. Its FFO was $1.07, surpassing analyst estimates of $1.04. REG expects full-year FFO to be between $4.27 and $4.29.
REG’s rival, Simon Property Group, Inc. (SPG) shares have lagged behind the stock, with a 17.8% gain over the past six months. However, SPG has taken the lead over the stock, with a 21% uptick over the past 52 weeks.
Wall Street analysts are bullish on REG’s prospects. The stock has a consensus “Strong Buy” rating from the 17 analysts covering it, and the mean price target of $79.41 suggests a potential upside of 6.4% from current price levels.
