Exane BNP Paribas prefers Colonial over Merlin within Spanish property

MERLIN Properties SOCIMI

13/09/2024 10:47

** Exane BNP Paribas upgrades Colonial  COL.MC  to
"outperform" from "neutral" on its new development pipeline and
names it its top pick within Spanish property
    ** The brokerage factors in Colonial's new development
plans, expecting rental creation of about 71 million euros as it
sees an average 7% YoC is "highly achievable" 
    ** Moreover, Exane expects income reversion and
stabilization of asset values to continue driving up earnings
multiples and investor interest in the stock
    ** It hikes its PT on Colonial by 25% to 7.5 euros
    ** Exane also raises its PT on Colonial's rival Merlin
Properties  MRL.MC  by 17% to 13.7 euros, keeping its
"outperform" rating 
    ** While Exane remains positive on both names, it says
Merlin, trading at about 20% discount to FY 2024 net tangible
assets, looks less attractive to Colonial's 38% discount
($1 = 0.9015 euros)

 (Reporting by Jakub Olesiuk)
 ((jakub.olesiuk@thomsonreuters.com))