Jefferies cuts PT, rating on Australia's Charter Hall as rates rise

Charter Hall Social Infrastructure REIT

22/05/2022 21:01

** Jefferies downgrades Charter Hall Group's  CHC.AX  rating
to "hold" from "buy", cuts PT to A$15.05 from A$19.23 on lower
funds under management (FUM) and earnings growth, among others
    ** Brokerage says rising rates has seen the property
investor "de-rate"
    ** Currently, Australia 10-year bond yield and cash rate are
3.28% and 0.35% with both expected to rise - Jefferies 
    ** Brokerage sees lower transaction volumes for CHC,
particularly in its listed A-REITs, including Charter Hall Long
WALE  CLW.AX , Charter Hall Retail  CQR.AX  and Charter Hall
Social Infrastructure  CQE.AX  
    ** Expects lower EPS growth due to lower FUM growth from
reduced transactions and "potentially lower performance fees in
a rising bond rate environment"
    ** Five of nine analysts rate the stock "buy" or higher,
three "hold" and one "sell" or lower; their median PT is A$20.00
– Refinitiv Eikon data 
    ** CHC stock has fallen about 35% this year
    
    
   


 (Reporting by Upasana Singh in Bengaluru)
 ((Upasana.Singh@thomsonreuters.com))