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Eureka Group Holdings Limited (ASX: EGH)
Eureka Group Holdings Limited (ASX: EGH) provides independent rental accommodation to independent retirees who are supported by the Australian Government pension. The company was listed on ASX on 01 July 2004.
Recommendation Rationale – SELL at AUD 0.60
EGH Daily Chart
EGH Daily Technical Chart, Data Source: REFINITIV
Valuation Methodology: P/E Approach (FY June'25E) (Illustrative)
Given the continuous growth from existing village, acquisition synergies, increase in demand and rental growth, etc., the stock might trade at a slight premium to its peers. For valuation, few peers like Waypoint REIT Ltd (ASX: WPR), Charter Hall Group (ASX: CHC), Centuria Industrial Reit (ASX: CIP), and other have been considered. Considering that the stock has surpassed its R1 level, share price movement, other risks associated with the business, and downside indicated by the valuation, it can face resistance at the current levels. Hence, a ‘Sell’ recommendation is given on the stock at the current price of AUD 0.60, as of 16 August 2024, at 2:15 PM AEST.
Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical issues prevailing geopolitical tensions. 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 all price data, currency, technical indicators, support, and resistance levels is 16 August 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.
Technical Indicators Defined: -
Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.
Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.
Stop-loss: In general, it is a level to protect further losses in case of any unfavourable movement in the stock prices.
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