Australia's Centuria Office REIT falls as FY23 outlook misses estimates

Centuria Office REIT

03/08/2022 04:34

(Updates with share moves and Morgan Stanley estimates)
    ** Shares of Centuria Office REIT  COF.AX  extend losses for
a second straight session, falling up to 1.5% to A$1.675
    ** Australian property investor on Tuesday posted funds from
operations (FFO) of A$104.9 million, or 18.2 Australian cents
per unit, for FY22  urn:newsml:reuters.com:*:nASX1Q1kzH
    ** Jefferies cuts price target on COF to A$1.77 from A$1.88;
maintains "hold" rating
    ** Brokerage says FY22 FFO result was a miss of 0.9% to its
estimates on account of higher debt costs in second half
    ** Co's FY23 outlook for FFO of 15.8 cents per unit (CPU)
and distribution of 14.1 cpu is below estimates of Morgan
Stanley and Jefferies
    ** Jefferies says that COF has elevated vacancies and large
lease expiries to address in FY23 in a tough market with cost of
debt increasing materially
    ** We see modest upside to FY23 guidance from conservative
debt cost assumptions, partially offset by leasing/occupance
risk - Jefferies
    ** Four of nine analysts rate the stock "buy" or higher,
three "hold" and two "sell" or lower; their median PT is A$1.95
– Refinitiv data
    ** Stock has fallen 27.4% this year as of last close 

 (Reporting by Jaskiran Singh and Navya Mittal in Bengaluru)
 ((Jaskiran.Singh@thomsonreuters.com;
navya.mittal@thomsonreuters.com))