MM has held MGR since March having bought, sold and re-bought the property developer, owner, and investment manager reasonably successfully over the last few years. We liked Mirvac’s FY26 result covered here, which pointed to FY27 being another year of earnings growth despite a still-challenging property backdrop, plus, the company sweetened the result with a new A$200m buyback – the stock popped ~7% on the day demonstrating it wasn’t just MM that thought it was a solid result.
Mirvac isn’t a complicated story, its trading ~10% below its historical valuation while improving earnings and yielding ~6% unfranked. The stock has fallen ~19% over the last year as interest rates have weighed on the real estate sector but if markets are pricing in a worst-case scenario as we saw yesterday, with MGR gaining almost 5% on the session, there’s plenty of upsides from here.
- We like the risk/reward for MG at current levels, expecting a rally back towards $2.40 – we hold MGR in our Growth Portfolio but could increase our exposure from 4% to 5%.
MM is bullish towards MGR around $1.85
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