Is Regency Centers Poised for Growth After Solid Q1 Leasing and Earnings in 2025?

Struggling with what to do about Regency Centers stock? You are not alone. With shares last closing at $71.34 and the stock logging a return of -2.4% in the past week, investors are watching closely for signs of which way things might move next. While the near-term numbers may feel a touch underwhelming, take a step back and the story gets much more interesting. Over the past five years, Regency Centers has surged 134.7%. Even the past three years have delivered a solid total gain of 36.9%. Clearly, this is not a name to dismiss after a few weeks of mild red ink.

So, what has changed lately? While the one-year return is slightly negative at -0.8% and year-to-date the stock is off just -1.2%, much of this seems tied to broader shifts in commercial real estate sentiment instead of anything fundamentally broken at Regency. Every dip creates the same itch: Is this an opportunity, or a growing risk?

That is where valuation comes in. Regency Centers currently hits 3 out of 6 undervalue checks, giving it a valuation score of 3. But what do those checks actually cover, and do they capture the full picture? Up next, we will break down exactly how the different valuation methods stack up for Regency Centers. Stay tuned for a smarter way to judge what the numbers really mean for your decision.

Why Regency Centers is lagging behind its peers

Approach 1: Regency Centers Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model aims to estimate a company’s fair value by extrapolating its adjusted funds from operations, projecting these future cash flows, and discounting them back to today’s terms. For Regency Centers, this method helps determine what the business is really worth right now, based on expectations for the long term.

Currently, Regency Centers reports a last twelve months free cash flow of $649.4 million. Analysts forecast healthy growth, with free cash flow expected to rise to $871.1 million by the end of 2029. While projections beyond five years rely on extrapolation rather than analyst consensus, the cash flow outlook remains strong and steadily rising throughout the coming decade, according to Simply Wall St.

Based on the DCF calculation, the estimated intrinsic value for Regency Centers stands at $93.58 per share. With the stock recently trading at $71.34, this model suggests shares are trading at a 23.8% discount to their underlying value.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Regency Centers.

Our Discounted Cash Flow (DCF) analysis suggests Regency Centers is undervalued by 23.8%. Track this in your watchlist or portfolio, or discover more undervalued stocks.

Approach 2: Regency Centers Price vs Earnings

For profitable companies like Regency Centers, the price-to-earnings (PE) ratio is a widely used and generally effective way to measure valuation. The PE ratio reflects how much investors are willing to pay today for one dollar of the company’s earnings, making it a quick snapshot of sentiment and growth expectations. A higher PE typically indicates optimism for future growth, while a lower PE can signal concerns or risks, though sometimes it simply points to undervaluation.

Currently, Regency Centers trades at a PE ratio of 33.1x. For context, the average PE among its retail REIT industry peers is about 27.1x, while the peer group average is 24.9x. This puts Regency Centers noticeably above both benchmarks, which might initially suggest it is a bit expensive in terms of standard multiples comparison.

However, Simply Wall St’s “Fair Ratio” goes beyond simple comparisons. The Fair Ratio, at 36.1x for Regency Centers, factors in a host of specifics about the company and its outlook, including growth prospects, earnings quality, risks, profit margins, industry dynamics, and market capitalization. This proprietary approach provides a more nuanced perspective than simply comparing to averages because it aligns the multiple to the real risks and rewards for this particular business.

Since the actual PE ratio (33.1x) is slightly below the Fair Ratio (36.1x), Regency Centers’ shares look to be trading at about fair value when accounting for its superior growth and business profile.

Result: ABOUT RIGHT

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Regency Centers Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives. A Narrative is your unique story about a company. It is where you connect your perspective, expectations, and knowledge to specific forecasts for revenue, earnings, profit margins, and ultimately, fair value.

Narratives go beyond raw numbers by linking the company’s real-world story, such as its market drivers and risks, to your assumptions about future results and what you believe the share price should be worth. On Simply Wall St’s Community page, Narratives make it easy for investors at any level to express their view, compare it with analyst consensus, and see the financial outcome of their expectations, all in a streamlined, interactive way used by millions worldwide.

What makes Narratives especially powerful is that they are dynamic. They adapt automatically as new information is released, such as earnings reports or industry news, ensuring that your fair value and buy/sell decisions always reflect the latest reality. By comparing your Narrative’s fair value to the market price, you can clearly see whether you think Regency Centers is a buy, hold, or sell based on your beliefs and the supporting facts.

For example, some investors see Regency Centers thriving because of strong suburban demand and assign a fair value of $79.75 per share, while others are more cautious, citing risk of tenant turnover and estimate a lower value closer to $72.39. Narratives help surface these perspectives so you can invest with confidence and clarity.

Do you think there's more to the story for Regency Centers? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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