Unibail-Rodamco-Westfield: Continuing Disposal Program and Deleveraging; Securities Look Cheap

No-moat Unibail-Rodamco-Westfield announced on July 21 that it has sold the Westfield Mission Valley Shopping Centres for USD 290 million—a 12% discount to the last unaffected appraisal value. This is yet another transaction that we think shows the market is too bearish on this REIT. URW securities trade at a massive 55% discount to the group's EUR 121 in net tangible assets and a 45% discount to our unchanged EUR 95.50 fair value estimate (AUD 7.80 for the Australia-listed chess depositary interests). We think the market is overestimating the risk of a dilutive equity raise, which looks less likely with every asset that is sold for a decent price. Despite a 32% rally since October 2022, URW securities screen as substantially undervalued.