Is it a good time now to buy Sydney Airport (ASX:SYD) shares?

Could now be a good time to think about Sydney Airport shares?
The post Is it a good time now to buy Sydney Airport (ASX:SYD) shares? appeared first on The Motley Fool Australia. –

Could this be a good time to be thinking about the Sydney Airport Holdings Pty Ltd (ASX: SYD) share price?

Since the start of July 2021, the Sydney Airport share price has gone up by 34%.

What’s going on with the Sydney Airport share price?

On 5 July 2021, Sydney Airport announced that it had received a non-binding proposal to acquire the business from a consortium of infrastructure investors at an indicative cash price of $8.25 per share.

The consortium comprises entities like IFM Investors, QSuper and Global Infrastructure Management.

In an initial response to the proposal, which is subject to a number of conditions, Sydney Airport has appointed Barrenjoey and UBS as its financial advisers and Allens as its legal adviser.

The Sydney Airport boards have commenced an assessment of the proposal.

Sydney Airport also said:

The Sydney Airport Boards note that Sydney Airport is a world class airport and one of Australia’s most important infrastructure assets. Sydney Airport is Australia’s largest airport and is the gateway to international travel in and out of Australia.

The indicative proposal has been made during a global pandemic which has deeply affected the aviation industry and the Sydney Airport security price. The indicative price is below where Sydney Airport’s security price traded before the pandemic. The boards are undertaking the value of the airport given its long-term remaining concession and the expected short-term impact of the pandemic. The boards will update securityholders accordingly.

Another bid?

According to reporting by the Australian Financial Review, it’s possible that a consortium led by Macquarie Group Ltd (ASX: MQG) could try to put in a counter offer to this IFM-led bid.

The global investment bank has reportedly been communicating with potential partners such as superannuation funds and funds managed by Macquarie Infrastructure & Real Assets (MIRA).

It was also reported by the AFR that Macquarie could use some of its own money for the deal.

The potential offer “deliberations” are still at an early stage and there is no guarantee that a formal offer will come from this. One option, according to the reporting, was that Macquarie may want to be part of the IFM consortium.

Is the Sydney Airport share price worth looking at?

The brokers at Macquarie have a price target on Sydney Airport of $8.50, but the rating is ‘neutral’ though an increased offer is possible.

Credit Suisse’s price target is $7.70 and it also has a ‘neutral’ rating on Sydney Airport. It notes there are still hurdles to pass, which means the indicative offer isn’t guaranteed to turn into a binding offer.

Morgan Stanley also sees the potential problems for proposal to be carried out, such as the potential need for the sale of ownership holdings of other airports in Australia.

The post Is it a good time now to buy Sydney Airport (ASX:SYD) shares? appeared first on The Motley Fool Australia.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of May 24th 2021

More reading

ASX 200 Weekly Wrap: COVID wobbles ASX as shares retreat

These were the best performing ASX 200 shares last week

The ASX shares with the most to lose from a delayed COVID reopening

Here are 3 of the ASX 200’s most heavily traded shares today

Why the Sydney Airport (ASX:SYD) share price flew higher again today

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!