Charter Hall has upgraded FY19 operating earnings growth guidance to 24% from 14-17%. The broker had assumed 16%. The upgrade largely reflects an upgrade to the Charter Hall Office Trust performance fee. Upside to this fee, and to assets under management, suggest upside risks to FY20 guidance, the broker believes.
The stock does not offer much in the way of total shareholder return at the price but given Charter Hall’s ability to attract listed and unlisted capital, and earnings upside risk, the broker retains Outperform. Target rises to $10.64 from $10.53.
Sector: Real Estate.
Target price is $10.64.Current Price is $11.05. Difference: ($0.41) – (brackets indicate current price is over target). If CHC meets the Macquarie target it will return approximately -4% (excluding dividends, fees and charges – negative figures indicate an expected loss).
