Finbar Group Ltd

              FRI Dividend Details
 
Building projects pipeline despite tough market conditions: Finbar Group Ltd (ASX: FRI) continues to build its development pipeline and recently got approval for 63 Adelaide Terrace, East Perth, which is JV project consisting of 247 apartments with 5 commercial lots with a forecasted project end value of $162 million. The group would receive 50% of the project profit plus management fee. FRI’s Arbor North JV project is also nearing completion for which the group already got $54.9 million in sales to date from $75.6 million project. On the other hand, FRI stock plunged over 23.16% (as of December 09, 2015) during this year to date impacted by challenging market conditions in Australia, and subsequently the group reported a NPAT decline of over 29% year on year (yoy) to $25.9 million in FY15. But, FRI has a solid long term potential with development approval of eight projects valued at $1.06 billion at hand as well as built a presales of over $407.7 million in 2015, adding to Finbar’s $2 billion project pipeline. FRI is also targeting international markets via partnerships and built presence in China, Singapore, Indonesia, and Malaysia markets. Finbar Group maintained its internal target return on cost of 25% even during tough conditions while its return on gross sales has been within the range of 19-26%.
 

Project Return on Cost & Sales (Source: Company Reports)
 
Meanwhile, FRI stock is trading at cheaper valuations with a relatively lower P/E of about 9x as compared to its peers and has an outstanding dividend yield. We reiterate our “BUY” recommendation on the stock at the current price of  $1.045
 
 
FRI Daily Chart (Source: Thomson Reuters)
 

Lend Lease Group

          LLC Dividend Details
 
Driving growth via Urban Regeneration projects:Lend Lease Group (ASX: LLC) shares corrected over 22.22% this year to date (as of December 09, 2015) like its peers due to volatile conditions in Australian economy. However, investors should note that LLC generated a total security holder returns of about 190% since the last five years till June 2015. Lend Lease Group built a strong portfolio of major Urban Regeneration projects, which would contribute over $8 billion with new opportunities. The group is the preferred bidder for over $7 billion worth of new work which is not included in the backlog revenue. Lend Lease expanded its development pipeline to $44.9 billion in FY15 from $34.7 billion in 2011, as well as enhanced its funds under management to $21.3 billion. The group built a construction backlog revenue to $17.3 billion, which is an increase by 7% as compared to FY14. LLC residential development business settlements surged by 24% on a year over year basis. The group even enhanced its portfolio of international urban regeneration projects at Singapore, Malaysia and the United States, while over 20% of the apartment pre-sales were from mainland China, from which 30% is estimated to be settled by June 2017.
 

LLC’s performance potential (Source: Company Reports)
 
As per the balance sheet highlights, LLC has cash and equivalents of $750.1 million and a gearing ratio of 10.5% as of FY15. Lend Lease is also focusing on retirement living and accordingly increased these units to 14,193 in FY15 from 12,417 in FY13. Lend Lease stock is trading at lower valuations with a P/E of about 12x and has a decent dividend yield. Based on the foregoing, we reiterate our “BUY” recommendation on the stock at the current price of  $13.06
 
 
LLC Daily Chart (Source: Thomson Reuters)
 

Stockland Corporation Ltd

                      SGP Dividend Details
 
Revamping growth via retirement living focus: Stockland Corporation Ltd (ASX: SGP) is targeting growth by focusing on retirement living to add support to its earnings. Retirement Living comprises over 9% of SGP portfolio as of FY15, and the company reported a strong first quarter of 2016 with 460 homes in hand. The Cardinal Freeman project at Sydney generated around 85% of first 2 stages reservation, which is much above the group’s forecasts. On the other hand, SGP recently undertook a $377 million redevelopment and expansion of its Green Hills Shopping Centre at East Maitland in the Lower Hunter Valley of New South Wales, wherein SGP would double the size of the center from 33,000 square meters of Gross Lettable Area (GLA) to over 70,000 square meters of GLA by mid of 2018. Stockland Corporation also built a strong development pipeline with over $1.1 billion in retail assets, $350 million in logistics and business parks and $20.7 billion in residential communities.
 

Portfolio Growth as of FY15 (Source: Company Reports)
 
The group intends to reevaluate most of its Commercial Property portfolio during first half of 2016. SGP forecasts a total year lot settlements of over 6,000, and expects its Distribution per security to be around 24.5c while underlying EPS growth of 6-7.5% in FY16. The stock is trading at attractive valuations with a P/E of about 10x and has a high dividend yield. Accordingly, we give a “BUY” recommendation on the stock at the current price of  $4.09
 
 
SGP Daily Chart (Source: Thomson Reuters)

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