Charter Hall Group CHC

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A$11.53 −0.27 (2.29%)

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As of Apr 26, 2024 6:10am Delayed Price Closed

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Company Report

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Charter Hall Group Is Well Prepared for Property Market Ructions

Alexander Prineas Feb 22, 2024

Charter Hall Group manages retail and institutional listed and unlisted property investments. It typically co-invests, aligning itself with its funds management clients. This gives Charter Hall diversified property exposure, so rental income produced accounts for about a fifth of the group’s EBITDA. A smaller portion of EBITDA comes from development, including development fees for managing projects for clients, and development profits on its own stake in each project.

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Price vs Fair Value

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CHC is trading at a 26% discount.

Price

A$12.09

Apr 23, 2024

Fair Value

A$53.92

Feb 22, 2024

Uncertainty

Medium

1-Star Price: A$88.82
5-Star Price: A$42.84
Economic Moat: Wfbrty
Capital Allocation: Ymsctvylfy

Bulls Say, Bears Say

Bulls

There remains a long pipeline of sale-and-leaseback opportunities, including new opportunities in sectors such as education and healthcare.

Bears

Charter Hall had almost everything in its favor until 2022, including falling interest rates, strong demand for property investments, and strong rental growth on property. All these tailwinds could be headwinds, given higher interest rates.

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Trading Information

Previous Close Price: A$11.80
Day Range: A$11.41–11.78
52-Week Range: A$8.63–13.92
Bid/Ask: A$11.45 / A$11.65
Market Cap: A$5.45 Bil
Volume/Avg: 1.1 Mil / 1.4 Mil

Key Statistics

Price/Earnings (Normalized): 11.51
Price/Sales: 9.00
Dividend Yield (Trailing): 3.80%
Dividend Yield (Forward): 3.83%
Total Yield: 4.00%

Company Profile

Charter Hall Group’s main activity is managing property funds for retail and institutional investors and listed REITs such as Charter Hall Retail REIT, Charter Hall Social Infrastructure REIT, and Charter Hall Long WALE REIT. More than two thirds of earnings come from funds management, and we expect this proportion to increase over time. Strong returns generated substantial performance fees over the last five years, which we expect to moderate due to lower property market returns in the future, but regular base fees should grow in the long run, and intermittent performance fees should continue. Charter Hall co-invests in its funds, so a portion of its earnings come from rent, as well as development fees and development profits on projects that it manages.

Sector: Real Estate
Industry: Real Estate - Diversified
Stock Style Box: Mid Value
Total Number of Employees: —
Website: https://www.charterhall.com.au

Competitors

Valuation

Metric	CHC	LLC	GMG
Price/Earnings (Normalized)	11.51	244.83	38.25
Price/Book Value	1.85	0.71	20.26
Price/Sales	9.00	0.45	39.97
Price/Cash Flow	11.99	—	63.92

Price/Earnings

CHC

LLC

GMG

Financial Strength

Metric	CHC	LLC	GMG
Quick Ratio	2.57	0.59	0.90
Current Ratio	2.71	1.02	1.20
Interest Coverage	−3.47	−1.36	3.32

Quick Ratio

CHC

LLC

GMG

Profitability

Metric	CHC	LLC	GMG
Return on Assets (Normalized)	−4.50%	−2.07%	4.36%
Return on Equity (Normalized)	−5.63%	−5.66%	5.96%
Return on Invested Capital (Normalized)	−4.69%	−4.06%	4.67%

Return on Assets

CHC

LLC

GMG

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