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What does MM think of CNI, CLW & LLC into current weakness?

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What does MM think of CNI, CLW & LLC into current weakness?

With property related stocks being hammered of late due to rising interest rates etc can I have your thoughts on CNI & CLW at current levels. I assume both are facing decreased property valuations when they next report which will adversely affect the share price. Also, LLC has been sold off despite the positive outlook for 2034 & 24. What are your thoughts on it around $8.00. Thank you


Hi Ian,

Centuria Capital Group (CNI) – As evident on the price action over the last 6 months CNI has been able to bounce ~$1.50 mark which is acting as a solid support. The business delivers 60% of its profits from property funds management and 35% from co- investments which has clearly been impacted. Consensus for FY23 is for flat earnings and a flat dividend. We hold CNI in our income portfolio and believe current prices are attractive.

Charter Hall Long WALE REIT (CLW) – CLW operates in Australia only and is a business in the similar boat like CNI. The stock has been hammered recently and the ~$4.00 mark has been a point of support. We like CLW’s long-term leases with secure tenants as this should provide some relief for the business. Additionally its already forecast to yield ~7.5% over the next 12-months which by definition will go up if the stock continues to fall. We like the stock at these new lows and would keep a close eye to see how the stock reacts to future macro developments.

Lendlease Group (LLC) – The LLC board described 2022 as a reset for the business as it managed to deliver a core operating profit of $28mn for the half year. The companies sitting on $3bn of liquidity and we feel the business is now well positioned as a post COVID recovery play through 2022 /23. The company has hinted that FY24 will be their year where things really come together, the price action on the stock is extreme as its down ~30% in the last 6 months. Technically it will be interesting to see if we test ~$7.50 region which should offer sound risk/reward, however we don’t think there is a huge rush to buy this one.

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Lend Lease (LLC)
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