SGP - Stockland Group

[nulla nulla]

$3.35 seems to be a recurring theme for SGP lately. Maybe it is trying to tell me something, maybe not. However it is worth noting that at this level (exdiv) it has come back to the rest of the REIT field in respect of discount to NTA and yield above 6%.



As always DYOR.

 

[nulla nulla]

From an interday high of $3.89 on 8th April 2011, SGP has slid to close today at $3.31 having tapped $3.27 in interday trading yesterday. SGP used to trade at a premium to nta but today was trading at 9% discount to nta with a yield of more than 7%.

Having shopping centres make up a strong part of the property portfolio means the drop off in the retail sector impacts on SGP. This slide is also replicated in Westfields.

Question is now, can it go lower?

 

[nulla nulla]

And the answer is YES. It can go lower than $3.27. In fact yesterday the share price dropped to $3.12 and today it ranged between $3.14 and $3.18. Retail and Residential appear to be dragging it down to new lows.

Curse Australians for paying off their credit cards and not spending. Don't they realise they have to spend for money to go arround and stimulate the economy?

 

[Liar's Poker]

And the answer is YES. It can go lower than $3.27. In fact yesterday the share price dropped to $3.12 and today it ranged between $3.14 and $3.18. Retail and Residential appear to be dragging it down to new lows.

Curse Australians for paying off their credit cards and not spending. Don't they realise they have to spend for money to go arround and stimulate the economy?

Probably worth considering the flight to online shopping as well. I don't believe we will ever see the death of the shopping centre, as they have become a more than just a place to shop in our culture. It's a place to meet, spend time, see events, express yourself, etc... Although, I do think it will effect retail outlets bottom line and ability to pay rent, so I imagine retail rental growth may slow.

SGP's assets are decent quality and they have diversified into other property sectors, so hopefully they are shielded somewhat from a poor retail environment more than others.


-Liar-

 

[So_Cynical]

And the answer is YES. It can go lower than $3.27. In fact yesterday the share price dropped to $3.12 and today it ranged between $3.14 and $3.18. Retail and Residential appear to be dragging it down to new lows.

My super fund account will be taking a little average down on Monday...retail wont die however rents will fall a little if not stagnate for a while.

 

[nulla nulla]

The profit warnnig from David Jones not only impacted on the David Jones share price but rippled through the retail sector and dragged in Westfileds and SGP. Looks retail is going to be down for some time until the overall mood in the community is a bit more confident.

Notwithstanding SGP has a high residential component with good occupancy as well as the retirement component, which they have just added too. imo sgp is probably one of those Ta/Fa shares a long term buyer and holder could do turn out allright with.

The scope for panic falls from here must be signifcantly reduced given the yield improvement with each fall and the widened gap from share price to nta. Further discounts to nta would likely start to attract the overseas hedge funds to soak up a significant holding.

 

[nulla nulla]

SGP may have found a support level at $3.10. Yield, P/E, Discount to NTA are probably at their most attractive levels since the gfc. Hopefully sgp gets the sale of the industrial assets away without hiccup further improving their prospects.



All they need now is for improved consumer confidence and spending to boost the retail sector.

 

[Liar's Poker]

Along with SGP, it is probably worth checking the attractiveness of SLF, which tracks the index of the property sector. Although only made up of 16 companies with a few being the vast majority (Westfield and SGP), it has taken a considerable hit over the last few weeks, now at $7.51.

-Liar-

 

[nulla nulla]

I missed the first opportunity to jump into sgp at $3.04 before it jumped back up to $3.15, however the combination of the U.S debt ceiling problem along with the sgp exposure to retail through the shopping centres saw the price drift back down to todays close at $3.05.



There is also the matter of sgp selling some industrial assets into an ipo which appears to have gone quiet, in the media at least. Might get cheaper still before it starts to climb back against its' nta value.

 

[skc]

Poor SGP. Can't even get a break on a day the market goes up 100 points.

I thought the profits weren't bad... the market first liked it then decided to hate it.

Perhaps the market is not happy with the outlook that next year EBIT will be the same as this year.

But at PE<10 no one is expecting them to grow in double figures

Closed my short yesterday to avoid the profit-announcement price spike. I guess I was right for the opening 10 minutes.

 

[nulla nulla]

Poor SGP. Can't even get a break on a day the market goes up 100 points.

I thought the profits weren't bad... the market first liked it then decided to hate it.

Perhaps the market is not happy with the outlook that next year EBIT will be the same as this year.

But at PE<10 no one is expecting them to grow in double figures

Closed my short yesterday to avoid the profit-announcement price spike. I guess I was right for the opening 10 minutes.

Here I was worried that you had gone long. I was fortunate not to jump into sgp at $3.04. I jumped into gpt instead at $2.92 and I am currently down $0.22.

I thought the report was good, realistic comments in respect of retail however I was concerned their A grade office portfolio wasn't contributing more. Never the less, at current share prices the return is good and the prospects for next year "more of the same" is also good.

If I can raise/squirell some extra dosh I would be taking a trade parcel on at these prices. As always DYOR.

 

[skc]

Here I was worried that you had gone long. I was fortunate not to jump into sgp at $3.04. I jumped into gpt instead at $2.92 and I am currently down $0.22.

I thought the report was good, realistic comments in respect of retail however I was concerned their A grade office portfolio wasn't contributing more. Never the less, at current share prices the return is good and the prospects for next year "more of the same" is also good.

If I can raise/squirell some extra dosh I would be taking a trade parcel on at these prices. As always DYOR.

People don't seem to like realistic comments these days. Things need to be rosy, positive and optimistic. Whatever happened to good old under-promise over-deliver.

I probably would have gone long for a day trade if I had time to read the presentation and watch it open. I would have thought today's strength would have been enough to jolt it back towards above $2.90.

The short was just part of a pairs trade so little to do with the absolute price of SGP itself.

 

[nulla nulla]

In September 2009 SGP reached a peak of $4.15. Just over a week ago the share price tapped a low of $2.52, near enough a drop of 40%. This share was considered the premium stock in the Australian REIT sector.



Last week the board announced, among otherthings, that they would commence a buy back of 5% of issued shares as a means of improving share holder equity and value in SGP.

As at close on Friday at $2.79 sgp is trading at a discount of 23.6% to NTA of $3.65, earnings are $0.317 cps equates to a price earnings ratio of 8.8 times, and distribution of $0.237 per share equates to a yield of 8.49%. Of course these figures were even better when the share price tapped $2.52.

With the buy back of 5% of the issued shares, the above figures will also improve. Maybe this will help put some stability in the share price and offset some of the irrational selling.

 

[nulla nulla]

Stockland rallied through the week to touch $3.06. Nice recovery from the recent sold down lows. Now all it needs to do is continue the climb back to the $3.50+ levels.

 

[nulla nulla]

The global market went into reverse and sgp went south with it. The last few days have been optimistic and sgp is now testing the upper levels of the downward channel. If it can break through and hold above $3.05 it may....may... head back to the $3.50+ levels. This is not unrealistic when you consider the present discount to nta, current yield levels and the share buy-back program.



Otherwise it may falter and retest the bottom of the channel finding new lows. Fortunately this is one roller coaster I am not currently riding. Lately it is like being in a lolly shop. You can see all these sweet opportunities but don't have enough dosh to buy them all.

 

[ep20072008]

I have been watching this stock this week. Tossing around between DJS and SGP. I agree with you if SGP could break the upper channel, then next target price would be AUD3.5 but seems this one is just a slow runner.

 

[nulla nulla]

SGP hit a recent interday high of $3.10 on September 1, 2011. Since then it has continued to move sideways and downward. However the last three days has seen sgp rally and once again it is trying to break out of the downward channel. If it can claw above $3.05 and hold, maybe......the next target would be the high of 21 July 2011 at $3.21.

 

[nulla nulla]

The sgp share price appears to have shrugged off the negative sentiment recently attached to retail outlet landlords and has broken out of the downward channel. The share price now appears to be recovering northward, testing the former resistance levels of $3.21. The next resistance level to break above (and hopefully hold) is $3.33 followed by $3.41.



Still trading at a discount to NTA, the share buy back is being seen as a good means of returning surplus capital to shareholders and helping narrow the gap between the share price and the NTA. Meanwhile the general market volitility continues to impact on sgp and provide opportunities for short term gains.

 

[nulla nulla]

Ticking all the right boxes SGP appears to have kicked off the market concerns about retail outlets being at risk due to rental returns under threat from low retail sales. Selling off non core property (to dexus) for a profit to June 30 valuations and talking about an on market buy back, SGP appears to be focused on improving shareholder value and probably long term returns. SGP has always been one of the better reit shares, often trading at nta or a premium to nta where the rest were trading at discounts to nta. SGP appears headed toward restoring their reputation as a "must have" reit.



The recovery curve appears to be in acceleration mode and the next resistance level appears to be arround $3.50. My only caution would be that the rapid rate of recovery is not unlike an exuberant spike and if it falters, the fall could be equaly as quick.

 

[nulla nulla]

Since the last post it looks like the sgp market lifted their foot of the accelerator and the share price dipped back to the lower channel line. Rebounding from $3.20 sgp appears to be finding resistance at the $3.42 mark.



All reit's took a hit on Thursday/Friday this week, so it will be interesting to see whether sgp can rally from the $3.30 area or whether it will get pushed back toward $3.20 support levels.