Analyst Mark Rothschild from Canaccord Genuity maintained a Hold rating on RioCan Real Estate Investment (RIOCF – Research Report) and decreased the price target to C$19.00 from C$19.50.
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Mark Rothschild has given his Hold rating due to a combination of factors affecting RioCan Real Estate Investment. Despite a strong financial performance in the first quarter of 2025, driven by healthy operating results and profits from condo completions, there are ongoing concerns impacting the stock price. The bankruptcy of HBC and a sluggish condo market pose challenges that are unlikely to be resolved in the near term, although RioCan is managing to close a high percentage of its condo units.
Furthermore, while RioCan’s units are trading below the net asset value (NAV), the market continues to apply a discount due to the prevailing uncertainties. The company’s management is carefully considering capital allocation, particularly regarding the HBC sites, and is only willing to invest further if attractive returns are evident. Additionally, the potential divestment of residential assets could provide capital for unit buybacks, especially if the unit price remains low. Despite these challenges, Rothschild acknowledges the long-term potential of RioCan’s high-quality portfolio.