Fundamental Insights About The ASSURA PLC Stock (AGR)

  • Feb 20, 2019 GMT
  • Team Kalkine
Fundamental Insights About The ASSURA PLC Stock (AGR)

Overview

Assura plc (AGR.L) is a healthcare REIT (real estate investment trust), based in the United Kingdom. The company is a primary care property developer and investor. In the United Kingdom, the company has the intent to develop, invests and manages a portfolio of primary care medical centres.

Key primary care sector includes minimal development risk, long leases without a break, secure occupier covenants, and limited supply with no speculative development.

(Source: Company Website)

 Property portfolio: Fleetwood Health and Wellbeing Centre, Fleetwood; Elbury Moor Medical Centre; Grey Gable Surgery; Urmston Group Practice, Urmston; Bewdley Medical Centre; Malmesbury Primary Care Centre, Malmesbury; Trellech Surgery; Alwoodley Medical Centre, Leeds; Claremont Medical Centre, Surbiton, and Frome Medical Practice, Frome.

Key subsidiaries: Abbey Healthcare Property Investments Ltd, Assura Aspire UK Ltd, Abbey Healthcare Group Ltd, Assura Trellech Ltd, Assura HC UK Ltd, Assura Aspire Ltd, and Assura Primary Care Properties Ltd.

Key Management: Ed Smith CBE (Non-Executive Chairman), Jonathan Murphy (CEO) and Jayne Cottam (CFO).

Key Financials – H1 FY2019 (£m)

(Source: Interim presentation, Company Website)

Financial Commentary (Six months ending September 2018)

  • In H1 2019, reported net rental income surged by 21% to £2 million when compared with the last year data.
  • The company reported EPRA earnings of £7 million, up by 36% as compared to last year.
  • In the first half of the financial year 2019, total dividend per share paid was 1.3 pence (H1 FY18: 1.2 pence).
  • In September 2018, property investments were up by 6% to £1,842.7 million, due to an increase in 39 properties portfolio at an amount of £108 million (rent £5.5 million and WAULT of 13.3 years). By the end of the current financial year, they are adding three more properties worth about £50 million.
  • Diluted EPRA NAV per share surged by 1% to 7 pence against 52.4 pence reported in March 2018.
  • In H1 FY19, total debt increased by 11.0% to £7. Capital expenditure incurred during the period was £104.0 million.

Ratios

(Source: TR)

Ratio Commentary

  • The reported gross margin in 2018, increased by 0.5 per cent to 96.0 per cent against 95.5 per cent reported last year.
  • EBITDA margin of 180.2% for FY18 stood considerably higher than the industry median of 71.3%.
  • The company’s reported net margin of 86.0% in 2018 declined significantly when compared with the last year.
  • ROE stood at 6.9% which was remarkably lower than the industry median of 11.6%.
  • On the liquidity front, AGR liquidity position was significantly higher than the industry median of 0.90.
  • On the leverage front, the debt-equity ratio was significantly down as compared to the industry median.

 

One Year Stock Performance

(Source: London Stock Exchange)

Stock Commentary

  • On 19th Feb 2019, Assura share closed at GBp 58.6, down by 0.34 per cent from previous day closing price.
  • Stock's 52 weeks High and Low is GBp 62.60/GBp 52.40. The stock was trading 6.39% lower than its 52w High and 11.83% higher than its 52w low, which shows that stock has the potential to make a new high.
  • Stock’s average traded volume for 5 days was 3,491,219.80; 30 days – 4,285,670.60 and 90 days – 3,778,551.12.
  • Average traded volume for 5 days was down by 18.54 per cent when compared with 30 days average traded volume.
  • At valuation front, the stock was trading at a Trailing-Twelve-Month (TTM) PE of 21.5x compared to the industry median of 18.1x.

Growth Prospects

  • The company’s main strength has been on getting investment grade rating of A- and raising £300 million in the listed bond market. The company would retain £398 million for further investments.
  • The company have targeted acquisitions worth £107 million.

Conclusion

The company growth prospects look favourable with an increase in the operating revenue and acquisitions initiatives in the pipeline, which indicate the stock movement towards 52-week high with support coming from few growth drivers like a surge in rental income and EPRA earnings, the market can keep a watch on Assura stock going forward.

 

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