Two FTSE 250 Stocks Under Discussion: Newriver Reit PLC and Sirius Real Estate Ltd

  • Dec 03, 2019 GMT
  • Team Kalkine
Two FTSE 250 Stocks Under Discussion: Newriver Reit PLC and Sirius Real Estate Ltd

Newriver Reit PLC (LON: NRR)

Real estate investment trust company, Newriver Reit Plc is involved in the business of real estate across the United Kingdom. The group mainly focuses on managing, buying, developing and recycling convenience-led, leisure and community-focused retail assets. The company has segregated its operations into two segments, namely, pubs and retail property assets.

NRR-Recent News

The company said in a press release that it had exchanged contracts to acquire Sprucefield Retail Park from Intu Properties PLC for a total consideration of £40.0 million on 25th November 2019, representing an 8.7 per cent of net initial yield. This move by the company is supposed to generate an additional annualised Net Property Income of £3.7 million for NewRiver Reit once the acquisition is completed.

On 2nd December 2019, the company successfully acquired Sprucefield Retail Park.

 The company in a press release was pleased to acquire the community pub company, Bravo Inns Limited for a total consideration of £17.9 million, having an EBITDA multiple of 6.8x. This transaction is expected to generate annualised EBITDA of £2.6 million. The transaction will result in an increased dividend cover, which is one of the key objectives of the company.

 Bravo Inns has 44 wet-led community pubs in North West England with high-quality, well-managed and well-invested management. This move will give the company exposure to the operator managed highly profitable pub model with opportunities to drive higher returns through accretive capital expenditure, a higher degree of management control & oversight and other asset management initiatives.

NRR-Financial highlights for H1 FY20 period ended 30th September 2019

(Source: London Stock Exchange)

The underlying funds from operations (UFFO) surged by 3 per cent to £26.4 million in the first half of the financial year 2020 as compared with the corresponding period of the financial year 2019. The net property income surged to £46.9 million in the first half of the financial year 2020 against the £43.2 million in the corresponding period of the financial year 2019. The fund from operations (FFO) per share was up by 1 per cent to 8.4 pence in the first half of the financial year 2020 against the corresponding period of the financial year 2019.

The retail occupancy and pub occupancy rate remained high at 95.6 per cent and 96.7 per cent, respectively. The retail net income (like-for-like basis) plunged by 3.5 per cent and was affected by CVAs and administrations. EPRA NAV per share for the first half of the fiscal year 2020 was recorded at 244 pence in contrast to 261 pence in March 2019.  The IFRS net assets were valued at £745.4 million, IFRS loss after taxation stood at £21.3 million, and IFRS basic loss per share stood at 7 pence in the first half of the fiscal year 2020. The company’s ordinary dividend stood at 10.8 per share in the first half of the fiscal year 2020 and remained flat against the same period of the fiscal year 2019. The company’s ordinary dividend cover surged to 80 per cent in the first half of the Financial Year 2020 from 78 per cent in the first half of the Financial Year 2019.

NRR-Stock price performance

Daily Chart as at Dec-03-19, before the market close (Source: Thomson Reuters)

At the time of writing (before the market close, at 11:55 AM GMT), shares of the Newriver Reit PLC were trading at GBX 189.00 and increased by 0.31 per cent against the previous day closing price. The shares of the company got admission for trading on the Alternative Investment Market of the London Stock Exchange on 18th August 2016. The total M-cap (market capitalisation) of the company stood at £576.61 million with an annual dividend yield of 11.13 per cent.

Daily Traded Volume Summary

The 5-day average daily traded shares, which exchanged hands were recorded at 884,617.60, which was approximately 12.79 per cent more than the 30-day average daily traded shares, which exchanged hands at the LSE (London Stock Exchange). At the time of writing, before the market close, today’s traded volume of the shares of the company was around 204,013 and number of trades executed stood at 192 at the LSE (London Stock Exchange).

52-week High/Low range

In the past 52 weeks, shares of the Newriver Reit have hovered between a high price level of GBX 246.26 (as on 16th April 2019) and a low-price level of GBX 143.20 (as on 16th August 2019). At the current level of trading, as quoted in the price chart, shares traded around 23.25 per cent below the 52-week high and were 31.98 per cent above the 52-week low.

Price Performance (in percentage)

The shares of the Newriver Reit have delivered a negative price return of 17 per cent on a Year on Year (YoY) basis as compared to the benchmark index, as the benchmark index gave 20.49 per cent negative return over the same period. However, the stock has given a negative price return of approximately 10.92 per cent on a year-to-date (YTD) time frame and was down by approximately 5.33 per cent in the last one month.

Relative Strength Index (RSI)

The RSI indicator for the shares of the company for the 3-days, 9-days and 14-days was recorded at 32.64, 44.94 and 45.55, respectively. Also, the stock’s 30-days RSI was recorded at 48.10.

Sirius Real Estate Ltd (LON: SRE)

Sirius Real Estate Ltd is into the business of managing branded business parks, provides conventional and flexible workspaces across Germany. The Company's main objective is to acquire business parks at attractive yields and integrate them under the Company's brand. In addition, the company offers reconfiguration and upgradation of vacant and existing spaces to the local market through its asset management and investments. The company aims to generate attractive returns for its shareholders by rental income and capital appreciation.

SRE-Recent developments

The company has acquired office space for €20.2 million in Hallbergmoos, near Munich Airport. This acquisition will be an asset to the company as it fulfils the acquisition criteria of the company, has low capital involvement. This move by the company will strengthen the business model of the company and shall result in growing rental levels.

SRE-Financial highlights for H1 FY20 for six months period ended 30th September 2019

(Source: London Stock Exchange)

The company’s revenue increased to €72,190 thousand in H1 FY20 from to €67,759 thousand in H1 FY19. The company’s Profit before taxation increased to €79.7 million in H1 FY20 from €78.2 million in H1 FY19. Funds of the company from operations increased by 16.3 per cent to €27.1 million in H1 FY20. The company’s Interim dividend surged by 8.6 per cent to 1.77 cents per share in H1 FY20 from 1.63 cents in H1 FY19.

The company sold 65 per cent of five assets to AXA Investment Managers, which resulted in proceeds of around €70.0 million of funds to re-invest. The company acquired three sites for €21.9 million along with two additional assets (notarised for acquisition) for €64.6 million.

SRE-Stock price performance

Daily Chart as at Dec-03-19, before the market close (Source: Thomson Reuters)

At the time of writing (before the market close, at 11:51 AM GMT), shares of the Sirius Real Estate were trading at GBX 81.20 and increased by 0.49 per cent against the previous day closing price. The shares of the company got admission for trading on the Alternative Investment Market of the London Stock Exchange on 04th May 2007. The total M-cap (market capitalisation) of the company stood at £832.79 million with an annual dividend yield of 3.68 per cent.

Daily Traded Volume Summary

The 5-day average daily traded shares, which exchanged hands were recorded at 1,741,406.00, which was approximately 35.78 per cent more than the 30-day average daily traded shares, which exchanged hands at the LSE (London Stock Exchange). At the time of writing, before the market close, today’s traded volume of the shares of the company was around 93,212 and number of trades executed stood at 59 at the LSE (London Stock Exchange).

52-week High/Low range

In the past 52 weeks, shares of the Sirius Real Estate have hovered between a high price level of GBX 82.60 (as on 27th November 2019) and a low-price level of GBX 58.00 (as on 31st January 2019). At the current level of trading, as quoted in the price chart, shares traded around 1.69 per cent below the 52-week high and were 40 percent above the 52-week low.

Price Performance (in percentage)

The shares of the Sirius Real Estate have delivered a price return of 34.67 per cent on a Year on Year (YoY) basis and outperformed the benchmark index, as the benchmark index gave 29.02 per cent return over the same period. However, the stock has given a price return of approximately 34.67 per cent on a year-to-date (YTD) time frame and was up by approximately 9.34 per cent in the last one month.

Relative Strength Index (RSI)

The RSI indicator for the shares of the company for the 3-days, 9-days and 14-days was recorded at 68.72, 75.09 and 71.42, respectively. Also, the stock’s 30-days RSI was recorded at 64.64.

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