SmartCentres Real Estate Investment Trust, the Real Estate sector company, was revisited by a Wall Street analyst yesterday. Analyst Michael Markidis from BMO Capital maintained a Hold rating on the stock and has a C$27.00 price target.
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Michael Markidis has given his Hold rating due to a combination of factors affecting SmartCentres Real Estate Investment Trust. While the company has shown positive near-term growth with occupancy gains boosting net operating income, its long-term organic growth potential appears limited compared to its primary peers. This is largely due to below-average leasing spreads, which may hinder future earnings growth.
Additionally, SmartCentres faces potential challenges with over $1 billion in debt maturities through 2026, which could act as a headwind against earnings growth. Despite these concerns, the company holds a significant pipeline of zoned land in Canada, which could serve as a catalyst for future value creation. The firm has also made progress in capital recycling, with plans to use proceeds from property dispositions to reduce debt, but elevated debt levels and interest rate headwinds remain concerns for the future.
SRU.UN’s price has also changed slightly for the past six months – from C$24.850 to C$25.880, which is a 4.14% increase.