Charter Hall LONG WALE REIT (CLW) went early and reported 1H results yesterday, it was actually scheduled for today. This is a stock we held and sold from the Income Portfolio recently given the pending headwinds from rising bond yields, and while yesterday’s result was solid, their guidance for a least 2.8% growth is not enough as bond yields rise. They’ve clearly come through COVID well and that’s because of their solid long term tenant base, however looking forward they’ve guided to “no less than 29.1cps” and that’s not good enough when rates are rising. CLW has a dividend of 6% which is clearly attractive, however growth in earnings is low and the market will become more concerned (as we are) about long duration assets.
MM views CLW as around about fair value here, but growth will be hard to come by
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