Jeffries Equity Research Says Stick With Industrials
June 24, 2020 — With the index down 9.5% YTD, it has outperformed other local financials and regional EPRA indices. The sharp rally has been facilitated by benign macro (esp. weaker USD) and banks supporting refinancing; sector performance is contingent upon these trends staying intact. Notwithstanding the strong rally, street continues to cut 12m forward distribution.
With supportive macro and government policies, Jeffries reseach said they are expanding their core preference for industrial REITs and upgrade MINT and MLT to Buy.
“While valuation in a historical context is a stretch and dividends are likely to take a near-term hit, industrial assets still have a better demand-supply outlook and structural themes are supportive. We maintain our Buy on AREIT, but raise our PT.”
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