CBL Stock Rises Following Q2 Earnings and Mall Acquisitions

Photo of author

By Ronald Tech

Shares of CBL & Associates Properties, Inc. CBL have gained 0.6% since the company reported its earnings for the quarter ended June 30, 2025, compared to the S&P 500 Index’s 0.8% loss over the same period. Over the past month, CBL’s stock has climbed 9.9%, outpacing the S&P 500’s 1.2% rise.

CBL’s Financial Performance Snapshot

In the second quarter of 2025, net income attributable to common shareholders came in at $0.08 per share, down 42.9% from $0.14 a year ago. Funds from Operations (FFO) were $1.48 per diluted share, down 1.9% from $1.51 in the prior-year quarter, while FFO, as adjusted, rose 7.5% to $1.86 from $1.73.

Same-center total revenues grew 1.7% to $156 million from $153.4 million, but same-center Net Operating Income (NOI) slipped 0.5% year over year to $104.9 million from $105.4 million. Segment-wise, same-center NOI from malls dipped 0.6%, outlet centers fell 5.2% and open-air centers declined 2%. Lifestyle centers, however, posted a 7.2% gain, while the “outparcels and other” category was down 3.7%.

CBL Properties’ Other Key Business Metrics

CBL’s portfolio occupancy edged up 10 basis points year over year to 88.8% as of June 30, 2025, from a portfolio occupancy of 88.7% as of June 30, 2024. Same-center occupancy for malls, lifestyle centers and outlet centers was steady at 87.3% compared with 87.2% as of June 30, 2024.

CBL Properties executed over 1.2 million square feet of leases during the quarter, with comparable new and renewal leases totaling about 774,000 square feet at a 3.2% average rent increase. New comparable leases saw a strong 39.5% rent jump, while renewals were down 0.7%. Same-center tenant sales per square foot rose 3.5% from the year-ago period, reaching $427 for the trailing 12 months, a 0.8% improvement from the prior period.

CBL & Associates Properties, Inc. Price, Consensus and EPS Surprise

CBL & Associates Properties, Inc. Price, Consensus and EPS Surprise

CBL & Associates Properties, Inc. price-consensus-eps-surprise-chart | CBL & Associates Properties, Inc. Quote

CBL’s Management Commentary

CEO Stephen D. Lebovitz highlighted the acquisition of four dominant malls for $178.9 million from Washington Prime Group — Ashland Town Center in Ashland, KY, Mesa Mall in Grand Junction, CO, Paddock Mall in Ocala, FL, and Southgate Mall in Missoula, MT — as a milestone in CBL’s portfolio optimization strategy, funded partly through proceeds from non-core asset sales such as The Promenade in Mississippi.

Lebovitz emphasized the acquisition’s immediate accretion to cash flow per share and its role in supporting a 12.5% dividend increase. He also cited robust leasing performance, a diversified tenant mix with new brands like Madewell and Dave & Buster’s, and tenant sales growth aided by tariff front-running and holiday timing. Despite some headwinds from bankruptcy-driven store closures, management noted strong backfill demand at higher rents, positioning CBL Properties for long-term benefits.

Factors Influencing CBL Properties’ Headline Numbers

The modest decline in CBL’s same-center NOI was primarily attributed to higher operating expenses, including the absence of one-time tax refunds received in the prior year and increased maintenance and repair costs. Bankruptcy-related closures of Forever21, JoAnn and Party City negatively impacted mall occupancy by nearly 70 basis points. However, favorable leasing spreads, particularly in new leases, and improved tenant sales provided offsetting strengths. The estimate for uncollectable revenues improved by roughly $1.1 million compared with the prior-year quarter.

See also  Clay 'Comes to Life' in the Hands of Master Pottery Instructor at Homestead Heritage

Tenant sales benefited partly from tariff-related buying shifts and the timing of the Easter holiday. Operating expenses during the second quarter increased $3.2 million due to elevated real estate taxes.

CBL’s Guidance

CBL updated its 2025 FFO, as adjusted, guidance to the range of $6.98–$7.34 per share, factoring in partial-year benefits from the four-mall acquisition and the impacts of asset sales, higher variable interest costs and lower outparcel sale gains. Management reaffirmed its same-center NOI growth outlook in the range of 2% decline to a 0.5% increase for the full year. Projected net income is pegged between $14.7 million and $25.7 million, with FFO, as adjusted, expected to be between $213 million and $224 million.

CBL Properties’ Other Developments

In addition to the four-mall purchase, CBL closed on dispositions totaling over $162.7 million year to date, including the $83.1 million sale of The Promenade in July, Monroeville Mall and Annex for $34 million in January, and Imperial Valley Mall for $38.1 million in February. The company also sold an office building in North Carolina for $3.5 million and three outparcels for $4 million.

Financing activities included a new $78 million non-recourse loan for Cross Creek Mall, which reduced the interest rate by more than 130 basis points compared to the prior loan, and a loan modification with Beal Bank to extend maturities and finance the recent acquisitions. In May, the board authorized a $25 million stock repurchase program, though no repurchases occurred during the quarter due to a blackout period.

Quantum Computing Stocks Set To Soar

Artificial intelligence has already reshaped the investment landscape, and its convergence with quantum computing could lead to the most significant wealth-building opportunities of our time.

Today, you have a chance to position your portfolio at the forefront of this technological revolution. In our urgent special report, Beyond AI: The Quantum Leap in Computing Power, you’ll discover the little-known stocks we believe will win the quantum computing race and deliver massive gains to early investors.

Access the Report Free Now >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

CBL & Associates Properties, Inc. (CBL): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research