LISTED PROPERTY
Is Equites Property Fund still worth paying a premium for?
Equites might be more expensive than most property companies out there, but its prospects are far brighter
Given the sizeable discounts to NAV that many property stocks are offering, is it still worth paying a premium for market darling Equites Property Fund? It’s an apposite question to ask, considering the 30%-plus dip in share prices of many property stocks over the past 12 months. Almost no-one has been spared, including Hyprop (down 34%), Accelerate (down 38%), Fortress B (down 31%) and Rebosis (down 85%). But Equites, as the JSE’s only property company to give you pure exposure to logistics, has still been a regular on fund managers’ stock pick lists. And despite the fact that its share price has been somewhat volatile in the past year (down nearly 2%), it is still up 50% over a three-year period. As a result, Equites is now trading 20% above its NAV. Equites’ forward dividend yield is 7%, one of the lowest among the sector’s 50-odd stocks. Analysts admit that Equites may look expensive. But the consensus is that this premium is justified, given that it continues to deliver an abov...
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