{"id":328734,"date":"2024-08-04T13:50:41","date_gmt":"2024-08-04T05:50:41","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=328734"},"modified":"2024-08-27T00:31:28","modified_gmt":"2024-08-26T16:31:28","slug":"stock-in-focus-mreit-inc-mreit-5-aug-2024-by-regina-capital-development-corp","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-mreit-inc-mreit-5-aug-2024-by-regina-capital-development-corp\/","title":{"rendered":"Stock in Focus: MREIT, Inc. (MREIT) – 5 Aug 2024 by Regina Capital Development Corp."},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>MREIT<\/td><\/tr>
Company Name<\/strong><\/td>MREIT, Inc.<\/td><\/tr>
Broker<\/strong><\/td>Regina Capital Development Corp.<\/td><\/tr>
Opinion Issued on<\/strong><\/td>5 Aug 2024<\/td><\/tr>
Recommendation<\/strong><\/td>Buy<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 18.20<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
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With the upcoming asset infusion expected to boost distributable income, we are reaffirming our BUY recommendation for MREIT, setting a fair value target of P18.20 per share. Given the current market price, MREIT has the potential to increase by ~41%.<\/p>\n\n\n\n

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Analysis and Opinion<\/h2>\n\n\n\n

In its latest report, MREIT Inc. (MREIT) saw a flatline in its net income of P733.1 million, up 0.37% year-on-year (y\/y) as topline grew modestly by +3.9% y\/y to P1.1 billion in the 1st quarter (1Q) 2024 on the back of sustained occupancy levels at 96%. The firm managed to keep its gross profit margin robust at 75% and operating margin at a solid 73%.<\/p>\n\n\n\n

As of 1Q 2024, the tenant mix of MREIT predominantly composed of BPOs, which accounts for 72% of the total, followed by traditional tenants at 22%, and retail and hotel tenants each contributing 2%. Last month, the company announced its plans to expand its portfolio this year by infusing six additional properties from its parent MEG, collectively valued at P13.15 billion. <\/p>\n\n\n\n

Properties set to be injected are: (1) One Fintech Place and (2) Two Fintech Place located in Iloilo Business Park, (3) the Davao Finance Center in Davao Park District, (4) Two West Campus, (5) Ten West Campus, and (6) One Le Grand in Fort Bonifacio. The acquisition of these properties will expand MREIT’s GLA by approximately 48% from its current footprint, adding an additional 157,000 sq.m. The transaction is currently awaiting regulatory approval, but once finalized, total GLA of the firm would totalto 482,000 sq.m. This expansion plan is well in line with the company\u2019s goal of expanding its portfolio size to 500,000 sq.m. by end-2024.<\/p>\n\n\n\n

Noticeably, MREIT, which focuses primarily on office spaces, is exploring the addition of retail assets to its portfolio. This move aims to diversify and balance its holdings, particularly given the strong performance of the retail sector in recent years due to robust consumer spending. This contrasts with the relatively lukewarm demand for office spaces.<\/p>\n\n\n\n

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Check how many brokers recommend this stock<\/h2>\n\n\n\n
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All Stock Rankings<\/a><\/blockquote>