Simon Property Group (NYSE:SPG) reported its Q4 2021 earnings after the market closed yesterday. The company exceeded expectations and raised its dividend three times in 2021. Investors were surely hoping for a similar outcome in the fourth quarter.
Meanwhile, the stock has recouped all its pandemic losses and is up 245% from its March 2020 bottom. Should we anticipate another surge following the report? The Elliott Wave chart below gives us a hint.
Simon ‘s daily chart reveals the 2016-2020 bear market that saw the price collapse from $226 to $42. What interests us more, though, is the subsequent recovery. It looks like an incomplete five-wave impulse pattern. Waves 1-through-4 seem to be in place already, but wave 5 is still missing.
Wave 4 looks like a textbook a-b-c zigzag correction. Furthermore, the price is now trying to turn the recently breached resistance line into support. Maybe Monday's report will help the bulls succeed at that task. Wave 5 is supposed to exceed the top of wave 3, so targets near $180 a share make sense.
Once there, however, the impulsive sequence from the bottom at $42 would be complete. According to the theory, a three-wave correction should follow. If this count is correct, investors should not be surprised to see another pullback to ~$130 in wave (2) before the uptrend can continue.