Mid-Cap

One Property Investment Management Company Trading Near Resistance Levels – CHC

March 07, 2024 | Team Kalkine
One Property Investment Management Company Trading Near Resistance Levels – CHC

CHC:ASX
Investment Type
Mid - Cap
Risk Level
Action
Rec. Price (AU$)

Charter Hall Group

CHC Details

Charter Hall Group (ASX: CHC) is an Australia-based property investment management company.

Financial Results

  • CHC announced H1 FY 2024 results for the period ending 31 December 2023. The company’s operating earnings post-tax was $195.1 Mn, which reflects operating earnings per security (OEPS) post-tax of 41.2 cents per security (cps)
  • It posted return on contributed equity of 21.4%. At the end of the period, its property investment portfolio value stood at $2.8 Bn, some 4% of the Group’s property platform of ~$68 billion.
  • The earnings resilience and diversification of the Property Investment portfolio is the key strength, combined with high-quality tenant covenant profile.

Outlook

Based on the no material adverse change in current market conditions, CHC has reconfirmed that FY 2024 earnings guidance for post-tax operating earnings per security of ~75cps.

Key Risks

The slowdown in global growth, volatility in the equity market, inflation, etc. are some of the risks CHC faces.

Fundamental Valuation

EV/Sales Based Relative Valuation

Stock Recommendation

During H1 FY 2024, the outflows impacting net inflows were predominantly because of secondary unit sales in the pooled funds, where selling demand was met by inflows from existing as well as new investors. The company’s performance is exposed to the risks related to the global slowdown as well as geopolitical tensions. Moreover, fluctuations in the interest rates can also impact its performance.

Therefore, investors should exit the stock.

Hence, a ‘Sell’ rating has been provided on the stock at the closing price of AUD 12.63 per share, up by 0.24% as on 7th March 2024. 

Technical Overview:

Daily Price Chart

CHC Daily Technical Chart, Data Source: REFINITIV

Markets are trading in a highly volatile zone currently due to certain macro-economic and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference date for share price chart and stock valuation is based on March 7, 2024. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.



Disclaimer-

This report has been issued by Kalkine Pty Limited (ABN 34 154 808 312) (Australian financial services licence number 425376) (“Kalkine”) and prepared by Kalkine and its related bodies corporate authorised to provide general financial product advice. Kalkine.com.au and associated pages are published by Kalkine.

Any advice provided in this report is general advice only and does not take into account your objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your objectives, financial situation and needs before acting upon it.

There may be a Product Disclosure Statement, Information Statement or other offer document for the securities or other financial products referred to in Kalkine reports. You should obtain a copy of the relevant Product Disclosure Statement, Information Statement or offer document and consider the statement or document before making any decision about whether to acquire the security or product.

You should also seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice in this report or on the Kalkine website. Not all investments are appropriate for all people.

The information in this report and on the Kalkine website has been prepared from a wide variety of sources, which Kalkine, to the best of its knowledge and belief, considers accurate. Kalkine has made every effort to ensure the reliability of information contained in its reports, newsletters and websites. All information represents our views at the date of publication and may change without notice.

Kalkine does not guarantee the performance of, or returns on, any investment. To the extent permitted by law, Kalkine excludes all liability for any loss or damage arising from the use of this report, the Kalkine website and any information published on the Kalkine website (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine hereby limits its liability, to the extent permitted by law, to the resupply of services. Please note past performance is neither an indicator nor a guarantee of future performance.

Please also read our Terms & Conditions and Financial Services Guide for further information.

Employees and/or associates of Kalkine and its related entities may hold interests in the securities or other financial products covered in this report or on the Kalkine website. Any such employees and associates are required to comply with certain safeguards, procedures and disclosures as required by law.

Kalkine Media Pty Ltd, an affiliate of Kalkine Pty Ltd, may have received, or be entitled to receive, financial consideration in connection with providing information about certain entity(s) covered on its website including entities covered in this Report.