Following a market update by Arena REIT, Macquarie remains attracted to the defensive earnings profile, and points out the certainty of income provided by its tenancies. The REIT has achieved like-for-like rent growth of 4.1% in FY22.
Some preliminary June 2022 asset revaluations (up 7.8% half-on-half) suggest to the analyst pro forma gearing of 19.5%, well below the REIT’s internal target gearing range of 35-40%.
The Outperform rating and $4.61 target price are maintained.
Sector: Real Estate.
Target price is $4.61.Current Price is $4.14. Difference: $0.47 – (brackets indicate current price is over target). If ARF meets the Macquarie target it will return approximately 10% (excluding dividends, fees and charges – negative figures indicate an expected loss).
