Insights

Why has the Brickworks share price rocketed up 50% in the last year?

Brickworks shares have performed strongly over the last 12 months.
The post Why has the Brickworks share price rocketed up 50% in the last year? appeared first on The Motley Fool Australia. –

The Brickworks Limited (ASX: BKW) share price has gone up more than 50% over the last year.

Brickworks is a diversified property business. It has a number of building products such as bricks, roofing and precast. But the company also has investments including a 50% stake of a joint venture trust with Goodman Group (ASX: GMG) and its holding of Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) shares.

The business has experienced growth in all areas.

Soul Patts experiences share price growth

Brickworks owns a 39.4% stake in Soul Patts, which has a diversified portfolio of investments in listed and unlisted companies. Major investments include Brickworks, TPG Telecom Ltd (ASX: TPG), New Hope Corporation Limited (ASX: NHC) and Australian Pharmaceutical Industries Ltd (ASX: API).

In the first half of FY21, Brickworks’ shareholding of Soul Patts increased by $720 million. Over the last 12 months, the Soul Patts share price has risen by around 65%.

Soul Patts announced on 22 June 2021 that it plans to take over the listed investment company (LIC) Milton Corporation Limited (ASX: MLT). The Soul Patts share price has increased by more than 9% since that announcement.

Property Trust

In June, Brickworks said that it’s expecting to report record property earnings in FY21, with property earnings before interest and tax (EBIT) of between $240 million to $260 million, driven by the continued increase in the value of its property trust.

Management explained that it has seen strong demand and sustained growth in the value of its property trust over a number of years. The COVID-19 pandemic has fuelled this growth, by accelerating industry trends towards online shopping and increasing the importance of well-located distribution hubs and sophisticated supply chain solutions.

Brickworks said that as a result of sales and an increase in transaction pricing, and an independent valuation of its property trust assets, the joint venture saw a revaluation profit of around $100 million which will be recorded in the second half. This represented Brickworks’ half of the valuation gain.

Practical completion of the Amazon facility at Oakdale West is expected to occur in the first half of FY22. The even larger Coles Group Ltd (ASX: COL) distribution warehouse is under construction, with completion expected in early FY23.

Building products

When it released its trading update, Brickworks said that it was seeing sales momentum in both Australia and North America.

In local currency terms, it’s expecting a higher EBIT from both the North American and Australian building product divisions. In Australia, sales were particularly strong in Queensland and Western Australia, but the availability of some materials were causing delays.

In the US it was seeing a strong rebound in sales volumes to housing customers in May. A strengthening of commercial sales was anticipated as delayed and deferred projects re-commence.

Brickworks share price

Brickworks has seen all of its divisions benefit over the last year as they recover and grow.

Citi currently rates Brickworks as a buy with a price target of $27.20.

The post Why has the Brickworks share price rocketed up 50% in the last year? 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

2 excellent ASX 200 blue chip shares named as buys

ASX 200 Weekly Wrap: Just like that… ASX back to record highs

3 ASX 50 shares named as buys

The other side of lockdown – ASX supermarket shares are flying

2 small ASX shares with big dividend yields

Motley Fool contributor Tristan Harrison owns shares of Washington H. Soul Pattinson and Company Limited. 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 Brickworks, COLESGROUP DEF SET, and Washington H. Soul Pattinson and Company 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!