Seritage Growth Properties Gets a Sell Rating from Boenning & Scattergood

In a report released today, Floris van Dijkum from Boenning & Scattergood reiterated a Sell rating on Seritage Growth Properties (NYSE: SRG), with a price target of $34. The company’s shares closed yesterday at $37.67.

van Dijkum wrote:

“We forecast a potential SRG dividend reduction as the 2018 payout isn’t supported by recurring free cash flow. We believe the company should consider paying a nominal quarterly dividend with a catch-up dividend at year-end. The company will also likely attempt to refinance its CMBS debt sometime later this year, based on our estimates. We continue to rate SRG shares Underperform, but its premium absolute and relative NAV valuation allows the company to explore corporate combinations. Our target price is based on the shares trading at a discount to estimated NAV.”

According to TipRanks.com, Dijkum is a 2-star analyst with an average return of 1.2% and a 50.9% success rate. Dijkum covers the Financial sector, focusing on stocks such as Pennsylvania Real Estate ate Investment, Retail Properties of America Inc, and General Growth Properties Inc.

Seritage Growth Properties has an analyst consensus of Moderate Sell, with a price target consensus of $44.

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Based on Seritage Growth Properties’ latest earnings release for the quarter ending March 31, the company reported a quarterly net profit of $10.31 million. In comparison, last year the company had a GAAP net loss of $19.84 million.

Based on the recent corporate insider activity of 59 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of SRG in relation to earlier this year.

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Seritage Growth Properties is a real estate investment trust. The company engages in the acquisition, ownership, development, redevelopment, management and leasing of retail properties throughout the United States. Its property portfolio includes mall, shopping centers, and freestanding locations.