We recommend rejecting the Charter Hall consortium’s uncompelling takeover offer for no-moat Hotel Property Investments, or HPI, providing this advice is consistent with your individual investing goals. The AUD 3.65 per share all-cash offer price is near the middle of our 3-star band. It represents an insufficient 4% premium to our unchanged AUD 3.50 per share fair value estimate, and a 10% discount to net tangible asset backing.
Hotel Property Investments' distribution yield is higher than most Australian REIT peers'.
Potential changes to Queensland's alcohol regulations could hurt pub profitability and the value of pub real estate.
|
Metric
|
HPI
|
BWP
|
CIP
|
|---|---|---|---|
Price/Earnings (Normalized) | 19.59 | 17.89 | 24.68 |
Price/Book Value | 0.93 | 0.99 | 0.84 |
Price/Sales | 8.87 | 14.29 | 9.36 |
Price/Cash Flow | 19.08 | 19.28 | 21.70 |
|
Metric
|
HPI
|
BWP
|
CIP
|
|---|---|---|---|
Quick Ratio | 0.04 | 0.30 | 0.59 |
Current Ratio | 2.33 | 0.48 | 1.71 |
Interest Coverage | 2.32 | 8.05 | 1.91 |
|
Metric
|
HPI
|
BWP
|
CIP
|
|---|---|---|---|
Return on Assets (Normalized) | 2.86% | 3.75% | 1.57% |
Return on Equity (Normalized) | 4.68% | 4.76% | 2.46% |
Return on Invested Capital (Normalized) | 4.45% | 4.66% | 2.93% |
|
1-Day Chart
|
Name
|
Price
|
Morningstar Rating for Stocks
|
Capital Allocation
|
Economic Moat
|
Market Cap
|
|---|---|---|---|---|---|---|
| VICI Properties Inc Ordinary Shares
VICI
| — | Scv | $34.7 Bil | |||
| W.P. Carey Inc
WPC
| — | Shq | $13.7 Bil | |||
| Stockland Corp Ltd
STKAF
| — | Gxzv | $8.7 Bil | |||
| Covivio SA ADR
FNCDY
| — | Txl | $6.9 Bil | |||
| Covivio SA
GSEFF
| — | Sznv | $6.9 Bil | |||
| GPT Group
GPTGF
| — | Ghwly | $6.7 Bil | |||
| Land Securities Group PLC ADR
LDSCY
| — | Nsm | $6.6 Bil | |||
| Land Securities Group PLC
LSGOF
| — | Kfwd | $6.6 Bil | |||
| UNITE Group PLC
UTGPF
| — | Vtwn | $6.3 Bil | |||
| Empire State Realty Trust Inc Class A
ESRT
| Wnrydcgm | Vnt | $1.8 Bil |
United States