CBL & Associates Properties, Inc. (CBL): A Bull Case Theory

We came across a bullish thesis on CBL & Associates Properties, Inc. (CBL) on Substack by Dave Waters. In this article, we will summarize the bulls’ thesis on CBL. CBL & Associates Properties, Inc. (CBL)’s share was trading at $22.42 as of April 8^th. CBL’s trailing P/E was 11.99 according to Yahoo Finance.

Aerial view of a shopping mall bustling with consumers.

CBL Properties, a mall owner that restructured and emerged from bankruptcy in 2021, has since made meaningful progress by paying down debt, selling non-core assets, and returning significant capital to shareholders. Despite this, the stock has fallen sharply amid rising concerns around consumer spending and leverage. However, this sell-off appears to have disconnected the stock from its intrinsic value. At the end of 2024, CBL held approximately $9 per share in cash and unencumbered real estate assets, which generated $66 million in net operating income. Using a conservative 15% cap rate, these unencumbered properties alone imply a valuation of $14 per share—suggesting the market is entirely overlooking both the value of CBL’s joint ventures and its properties tied to the term loan. The company remains committed to strengthening its balance sheet and continuing shareholder returns, providing a clear path forward. The current stock price implies little to no value for a sizable portion of its portfolio, creating a significant mispricing opportunity. With visible catalysts in debt reduction, asset sales, and a potential re-rating as consumer fears ease, the stock offers an attractive asymmetric risk/reward profile, with the downside already priced in and upside potential as value becomes more fully recognized by the market.

CBL & Associates Properties, Inc. (CBL) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 22 hedge fund portfolios held CBL at the end of the fourth quarter which was 20 in the previous quarter. While we acknowledge the risk and potential of CBL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than CBL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.