SCG - Scentre Group

[skc]

folks
Could some one please advise if SCG is still attractive compared to WFD ?
I am a bit confused to understand as SCG and WFD have similar board / Lowey , SCG owns WFD , market capitalisation of SCG is much more than WFD, both are having competing business but performance wise they are not same.
What am I missing here ?
Do not hold any one but MF Motley Fool is heavily barracking for WFD and silent about SCG.
Thanks in advance

SCG holds Australian shopping centres (Westfields) plus the development arm (that build new centres).

WFD holds UK and US shopping centres, plus development arm.

SCG and WFD do not have any cross ownerships as far as I am aware. They do have common shareholder in the Lowy family.

Yes they have overlaps in management and Board personnel, but their businesses don't really overlap due to the geographical split.

I make no comment on their relative attractiveness - it depends on your investment goal and outlook on different issues like $AUD/USD, interest rates and overall economic conditions etc etc.

P.S. Only my broadstroke understanding of the 2 entities. Please verify for yourself.

 

[nulla nulla]

There hasn't been a lot of recent activity in this thread so I though it may be worthwhile throwing up a long term chart as well as a table comparing the share information over the past three or so years.

Disclaimer: The table information is taken from the A-REIT Tables posted previously. Accordingly if there were any errors in those tables then they have been repeated in this table.

Edit: This table was posted with errors in the March 2017 row which have now been corrected. Sorry

 

[jbocker]

Anyone holding this? I have some for the dividends. Paid 20.9 cents for 2018, Current Price $3.94 gives over 5% return. High price for year $4.535 means return would be 4.40%. Still not bad.
I suppose a reasonable share for dividends.
Australian Shopping Centres. Is that a risk laden industry in todays world?

 

[luutzu]

Anyone holding this? I have some for the dividends. Paid 20.9 cents for 2018, Current Price $3.94 gives over 5% return. High price for year $4.535 means return would be 4.40%. Still not bad.
I suppose a reasonable share for dividends.
Australian Shopping Centres. Is that a risk laden industry in todays world?

I guess you'd have to look at its current books to see if there's any risk...

But purely from a macro point of view... the perfect storm is going to hit shopping centres.

High interest rates; households being stretched; retailers (tenants) not doing well; potential job losses possibly causing a recession we've rarely seen before in a few generation.

 

[jbocker]

I guess you'd have to look at its current books to see if there's any risk...

But purely from a macro point of view... the perfect storm is going to hit shopping centres.

High interest rates; households being stretched; retailers (tenants) not doing well; potential job losses possibly causing a recession we've rarely seen before in a few generation.

Shopping Centres are a conundrum, as they are places where people seemingly like to go to, I think even in bad times. Why I am not sure, maybe just to check each other out, window shop, try on stuff. Is it some form time wasting / filling.
The big problem, not spending money. Well not much more than a coffee and a gratifying cake.

I tend to agree with you the perfect storm is looming, but how do Scentre Group curtail it or ride it out along with the shop owners. I think local communities would hate to see them close down, would they start spending to help keep their local business.

The Elephant in the mall is the On Line Shopping of course.

 

[Knobby22]

In the USA some shopping centres have failed but the good ones are doing well.
It a the quality of the assets that count. Don't know how Scentre stacks up.

 

[jbocker]

In the USA some shopping centres have failed but the good ones are doing well.
It a the quality of the assets that count. Don't know how Scentre stacks up.

Well it is a spinoff from Westfield. If any group knows quality, you would think it was them. Unless there were other reasons why it was spun off.

 

[greggles]

An ugly half year financial result announced by Scentre Group this morning.

For the six months ending June 30, the company posted a statutory loss of $3.6 billion, which includes an unrealised non-cash reduction in property valuations of $4.08 billion.

It's going to be a very long and hard road back to profitability for SCG. I have real concerns about the future of shopping centres as we currently know them and suspect that the larger Westfield style centres do not have much of a future in their current form. There has been a dramatic increase in online shopping since April and people seem to be getting used to the idea that it is easier and more convenient.

While SCG's share price has halved in the last six months, Kogan's have more than quadrupled. The writing appears to be on the wall. Things will never be quite the same after COVID-19.