MGR retreated over 2% on Wednesday, following the weak real estate sector, a group that also came under pressure in the US this morning after Powell’s comments. This diversified property group has traded between $1.80 and $2.50 for the last 2-years, with markets now looking for much fewer rate cuts into/through 2026, it’s easy to imagine the stocks drifting back towards $2.15, the mid-point of the recent trading range. In simple terms, the reason to be long MGR has largely evaporated in the last 24 hours.
It’s important to note that we liked the MGR trading update this month, but we have a “weighty” exposure in our Active Growth Portfolio to the real estate sector with MGR, NSR and to a lesser extent, Goodman Group, all skewed towards a lower interest rate environment.
- We think MGR will struggle to break above $2.50 in the new, less dovish environment: MM holds MGR in our Active Growth Portfolio.
MM is now adopting a neutral view towards MGR
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