Simon Property Group Preferred Stock: A Reasonably Priced Investment Opportunity

Simon Property Group's preferred stock, SPG.PR.J, has been upgraded to Buy due to its reasonable pricing. The company's main business is shopping centers, and its preferred shares provide a steady income stream. With its strong financial position and steady dividend payments, the preferred stock is a good investment option.

Simon Property Group's preferred stock, SPG.PR.J, has been upgraded to a "Buy" rating by analysts, reflecting its reasonable pricing and strong financial position. The company, which operates shopping centers and entertainment destinations across North America, Europe, and Asia, has demonstrated robust financial health and steady dividend payments, making its preferred shares an attractive investment option for income-oriented investors.

The upgrade comes after Simon Property Group reported stronger-than-expected second-quarter results, with funds from operations (FFO) per share of $3.15, surpassing the average analyst estimate of $3.05. The occupancy rate as of June 30, 2025, stands at 96.00%, indicating strong demand for the company's properties. Furthermore, Simon Property Group has increased its guidance for 2025, signaling confidence in its financial prospects [1].

The preferred stock, SPG.PR.J, offers a yield to call (YTC) of approximately 5.98% at the current price of $53.10, making it a compelling income opportunity. Analysts recommend buying the stock when the YTC is between 6.50% and 3.50%, with a hold rating between 5.50% and 3.50%. Below 3.50%, the stock is considered a sell [1].

Simon Property Group's strong financial position is further evidenced by its recent debt issuance. On August 13, 2025, the company issued senior notes totaling $1.5 billion, with spreads of 60 basis points for the 5-year US Treasury yield and 88 basis points for the 10-year US Treasury yield, indicating market confidence in the company's ability to repay its debt [1].

The company's steady dividend payments, with a quarterly dividend of $2.15 per share, provide a significant income stream for investors. Although the preferred stock dividend is lower at approximately $700,000 per quarter, the common stock dividend provides an additional buffer, making the preferred stock an attractive option for income investors [1].

In conclusion, Simon Property Group's preferred stock, SPG.PR.J, offers a compelling income opportunity with a reasonable yield to call and a strong financial position. The upgrade to a "Buy" rating reflects the company's robust financial health and steady dividend payments, making it an attractive investment option for income-oriented investors.

References:
[1] https://seekingalpha.com/article/4817993-always-buy-simon-property-group-preferred-stock-when-reasonably-priced