The Stockland (ASX:SGP) share price is down slightly today. Here’s why.

The Stockland Corporation Ltd (ASX: SGP) share price is down slightly after the property group delivered mixed Q1 results
The post The Stockland (ASX:SGP) share price is down slightly today. Here’s why. appeared first on Motley Fool Australia. –

illustration of three houses with one under a magnifying glass signifying mcgrath share price on watch

The Stockland Corporation Ltd (ASX: SGP) share price has edged down on a mixed Q1 result today. The property group reported its highest quarterly net sales in over three years in residential homes, strong sales in retirement living, and improved rent collections in retail. Yet, Stockland still recorded ongoing problems in rent collection in retail and workplace, or commercial real estate sectors. 

Factors supporting the Stockland share price

The residential sales represent the strongest element of the company’s Q1 performance. There are a multitude of reasons for this including current very low interest rates, the government stimulus, and improved credit availability. The company has also championed the preference for its master-planned communities. 

Sales moderated in August and September nationwide, although still settled above historical averages. In Victoria, trading remained subdued due to Stage 4 COVID-19 restrictions, despite enquiries remaining above pre-coronavirus levels. However, moving forward NSW is likely to continue performing strongly due to undersupply of vacant land. In addition, the company also believes Victoria is likely to see an increase in sales in Q2 FY21 as restrictions ease.

However, there are some constraints. Queensland and West Australia conversion rates are likely to moderate over the near term as some builders have reached capacity to deliver by the HomeBuilder commencement timeframe. While this is an impact on potential revenue generation, it is a better problem to have than collapsing demand.

Given the current residential demand, the company is focussing on restocking inventory with a number of significant opportunities. To clarify, the company is looking for opportunistic land acquisitions to maintain leading market share.

Retail, workplace and logistics

In the company’s retail town centres portfolio, footfall has risen to approximately 97% of pre-COVID levels. Unfortunately, Victoria represents 12% of the retail portfolio by rental income. This is likely to delay full rent recoveries further.

Lastly, logistics and workplace remain strong elements of the company’s portfolio. Logistics has a weighted average lease expiry (WALE) of 5.1 years, with a portfolio occupancy of 96.2%. Meanwhile, workplace, the companies commercial facilities, has a 93.4% occupancy, and a WALE of 2.9 years. 

Stockland is progressing a $3.1 billion future development pipeline in the industrial space. Within the workplace segment, the company is planning a $2.5 billion development pipeline which is progressing in line with expectations. This will increase the weight of these two segments within the company’s overall portfolio. 

Stockland company performance

The Stockland share price is slightly lower today on the mixed Q1 results, down 0.49% at $4.09. However, over the past month ths share price has risen by 12.5%. The company is currently trading at a price to earnings (P/E) ratio of 14.65 and has a trailing 12-month dividend yield of 5.9%.

Man who said buy Kogan shares at $3.63 says buy these 3 ASX stocks 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.*

In this FREE STOCK REPORT, Scott just revealed what he believes are the 3 ASX stocks for the post COVID world that investors should buy right now while they still can. These stocks are trading at dirt-cheap prices and Scott thinks these could really go gangbusters as we move into ‘the new normal’.

Find out the names of our 3 Post COVID Stocks – For FREE!

*Returns as of 6/8/2020

More reading

Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post The Stockland (ASX:SGP) share price is down slightly today. Here’s why. appeared first on Motley Fool Australia.

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!