Macquarie believes Aventus Group is well placed to benefit from the reopening of the economy and a residential rebound. Peer disclosure implies rental abatements of 32-37% over the lockdowns and the broker has applied the same assumption for Aventus, while suggesting that Aventus’ higher quality portfolio implies upside risk.
Gearing is elevated but asset values are relatively defensive, the broker notes, and on an 8% plus yield and -12% discount to net tangible asset value the broker sees the stock as a sustainable longer term discretionary play. Upgrade to Outperform from Neutral, target rises to $2.57 from $2.43.
Sector: Real Estate.
Target price is $2.57.Current Price is $2.20. Difference: $0.37 – (brackets indicate current price is over target). If AVN meets the Macquarie target it will return approximately 14% (excluding dividends, fees and charges – negative figures indicate an expected loss).
