Segro Share Discussion Threads

[nexusltd] 20/4/2022 11:54

Q1 Trading Update tomorrow 21st April.

[m_kerr] 21/2/2022 21:44

i'm not sure - whether the underlying assets are fairly priced or not i don't see how you make a decent return at these valuations. if everyone is very enthusiastic about future prospects and prices it for a long period of good growth, there's nothing left on the table for you. retail parks for instance are yielding 7%, and have traded solidly throughout lockdown.

[m_kerr] 18/2/2022 16:38

3-3.5% yields nowadays in the sector. just 5 years ago you were looking at 6% yields. comparing the figures for rent per square foot, broadly speaking the like for like increases look to be up roughly 10-20% since then (much lower i imagined - it's not a like for like comparison due to changing geographies etc).

so effectively, yield compression alone has an 84% increase in valuation, with rental growth on top providing the further gain. in order to get the same valuation increase again in 5 years time would require the yield to fall to ridiculously low levels - 1.8%.

in other words, i get the feeling that the time to buy into this sector and make good returns has come and gone. a geared 2% starting yield including the increase today is very low indeed.

[income investor] 18/2/2022 10:15

Massive 40% increase in NAV to 1137p caught my eye. All very encouraging!

[jonwig] 18/2/2022 08:29

Not bad, are they!

FT summary:

The popularity of online shopping has driven a near-threefold increase in full-year profits at warehouse owner Segro, as ecommerce businesses seek more space to cope with growing demand.

The London-listed landlord, whose biggest client is Amazon, said on Friday that pre-tax profits almost tripled year-on-year in 2021, reaching £4.4bn as the company lifted rents and secured new tenants.

Segro, whose share price touched a record high last month, said it would increase its full-year dividend 10 per cent.

The FTSE 100 group’s results underline how demand for online shopping has split the fortunes of commercial landlords during the pandemic. While the success of ecommerce has benefited warehouse owners such as Segro, landlords reliant on income from high street retailers have struggled to recoup rents throughout the pandemic.

Segro said it expected strong demand throughout this year, adding that, combined with historically low levels of vacant properties, this should result in higher rents.

[ygor705] 18/2/2022 08:10

Strong increase in both eps and net asset value here plus 10% upping of yearly dividend. Not much to dislike. £15 share price now looking a distinct possibility once the markets stabilise.

[nexusltd] 20/1/2022 11:18

I agree. JPM's is one of many opinions. I posted it because they are fairly influential and they are not listed as an advisor or broker.

[jonwig] 20/1/2022 06:54

Interesting, thanks.

I'd assumed the underperformance was caused by the nav premium being a bit excessive!

[nexusltd] 19/1/2022 23:52

JPMorgan Cazenove upgraded Segro to 'overweight' from 'neutral' today and lifted the price target to 1,450.0p from 1,310.0p as it argued that recent underperformance was a buying opportunity. JPM said SGRO has borne the brunt of the shift in sentiment towards value thus far in 2022. This has driven the recent underperformance of SGRO, which was down 10% year-to-date versus the sector down 3%. "FY21 will be a record year for logistics with capital and rental growth in 2H outpacing any HY period over the last decade, and results should provide a strong catalyst to drive a re-rating through 2022," the bank said. "We believe the opportunity ahead remains attractive and upgrade our NAV forecasts and now sit 4%/6%/7% ahead of compiled company consensus for 21/22/23."

JPM also placed the shares on ‘Positive Catalyst Watch’ into the FY21 results, which are due on 18 February.

[jonwig] 23/12/2021 15:43

At first I thought they might be going back into offices, but no. And not boxes. I think they plan high-spec technology and medical research facilities Data centres are popular these days.

[nexusltd] 23/12/2021 14:44

Large £425m acquisition in Slough; currently mainly offices. Back to the future. PR speaks of short leases, and Segro's ambition to re-develop the 39 acre site with modern facilities. Any thoughts?

[jonwig] 20/10/2021 07:58

That's a good point.

[sogoesit] 20/10/2021 07:21

Over 50% of the money spent on acquisitions, £46/£84m, was spent on Land.
So future growth looks like being assured.

[jonwig] 20/10/2021 07:15

Trading update:



Everything going in the right direction. They seem to be pushing rent increases quite aggressively. I suppose that's easily done these days. So many companies need sheds, and switching from a shed you already occupy isn't exactly trouble-free.

[donald t] 21/9/2021 07:33

https://www.marketscreener.com/quote/stock/SEGRO-PLC-4007239/news/SEGRO-SmartParc-partners-with-SEGRO-to-deliver-a-1-85m-sqft-high-tech-food-manufacturing-and-distr-36472698/

[jonwig] 04/9/2021 07:16

I suppose there will be a rush to fill up space with stocks (assuming non-perishable). Biggest shed wins.

[sogoesit] 04/9/2021 05:12

Well done! I have been lucky enough over many years to have had a “Villa” stock… even or two!

Anyway, just a thought; what happens to demand for warehouse space when there is significant supply-chain disruption/adjustment? NAV guesses on a postcard….

[donald t] 20/8/2021 23:44

I can now retire thanks to Segro

[donald t] 20/8/2021 23:19

Shares talk to me. ?

[alter ego] 20/8/2021 22:44

Don’t you think the share price does enough “talking”;?

[donald t] 20/8/2021 21:41

I've made big bucks with Segro

[donald t] 20/8/2021 21:41

Can't understand why no one talks about Segro, it seems to fly under the radar.

[sogoesit] 06/8/2021 11:42

Quote from Tritax Big Box HY Results maybe explains:

"Unprecedented demand for prime logistics space supported by long-term positive structural drivers

· Highest H1 take-up on record of 21 million sq ft with a further 16 million sq ft of space currently under offer, of which 48% is for space >500k sq ft.

· Limited development response relative to demand has led to record low 2% vacancy and strong rental growth across all regions.

· Positive outlook for logistics property has resulted in higher investor allocations into the sector, driving prime yields down further."

Own versus rent is a financial decision but, if all warehouse space opportunity is taken by the specialist property companies, it will unlikely be strategically beneficial (profitable) for a non-specialist to enter this business. Entering a business sector, as an owner, implies taking timing risk.
(NAValuation is backward looking. Stock price is forward looking)

[penciles2] 05/8/2021 12:02

I have been holder from low £2.00s I struggle to see why so far over nav
Thought that keeps going through my mind is maybe Amazon is interested in
Securing warehouse space better to own than rent.

[sogoesit] 05/8/2021 08:19

Certainly has performed well since the 900/1000p consolidation range.
On a TA basis has now regained and over-extended on the long term upper trend-line channel.

All my “expensiveR21; stocks have performed well in last 6 months so owning “premium”; rated shares has paid off.