Building products company CSR has struggled this month after its full-year’s earnings weren’t well received by analysts which has led to a few downgrades. Overall earnings were largely in line with expectations with NPAT of $192.6mn and the 18c dividend a slight beat – the stock trades ex-dividend later this week. The company talked up a strong pipeline of detached housing projects and an uptick in apartment / non-residential projects but the market is clearly concerned around the impact of rising interest rates.
Our main concern apart from this months ~15% share price drop is the market may take a lot of convincing that housing / building will be able to maintain its strength in the face of rising interest rates.
MM has our CSR position on “close watch”
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