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Share Name Share Symbol Market Type Share ISIN Share Description
Unite Group Plc LSE:UTG London Ordinary Share GB0006928617 ORD 25P
  Price Change % Change Share Price Shares Traded Last Trade
  -1.00 -0.1% 1,022.00 11,412 08:28:39
Bid Price Offer Price High Price Low Price Open Price
1,021.00 1,023.00 1,023.00 1,016.00 1,020.00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Real Estate Investment & Services 215.60 -120.10 -31.80 4,079
Last Trade Time Trade Type Trade Size Trade Price Currency
08:28:39 AT 288 1,022.00 GBX

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Posted at 07/2/2023 08:20 by Unite Daily Update
Unite Group Plc is listed in the Real Estate Investment & Services sector of the London Stock Exchange with ticker UTG. The last closing price for Unite was 1,023p.
Unite Group Plc has a 4 week average price of 926.50p and a 12 week average price of 872p.
The 1 year high share price is 1,209p while the 1 year low share price is currently 773.50p.
There are currently 399,159,943 shares in issue and the average daily traded volume is 733,457 shares. The market capitalisation of Unite Group Plc is £4,079,414,617.46.
Posted at 01/12/2022 12:06 by maddox
A reassuring opinion article in the FT: 'Student housing is the bubble that won’t burst'

httPs://www.ft.com/content/2001e357-067d-4ad3-a32e-0d451ffaa0eb

Key points:

>> It's a property sector that is attracting significant Private Equity investment;

>> Take-over deals at high valuations (£280k per bed is cited);

>> Highly resilient demand - both domestic and international student demand growth;

>> Structural supply imbalance will persist for the rest of the decade; and

>> HMO landlords under-pressure.

So, all very supportive of PBSA sector valuations; and yet we're 24% below UTG's 52 Week High of 1207p. I suspect it's as a result of the recent Govt mini-budget from the Chancellor of the Exchequer, Kwasi Kwarteng. The subsequent margin call on LDO holders, pension funds and the like, caused them to indiscriminately dump their equity holdings in a panic to raise cash to pay the call. These would be the type of investment institution that would be attracted to UTG. I cannot find supporting evidence to substantiate this but it's my working hypothesis.

Posted at 11/10/2022 10:06 by speedsgh
Unite will keep delivering, says Peel Hunt - HTTPS://citywire.com/funds-insider/news/expert-view-auction-tech-ds-smith-unite-hollywood-bowl-and-trufin/a2399485#i=4

Student accommodation group Unite (UTG) has seen robust demand boost quarterly valuations and broker Peel Hunt expects the business to continue delivering.

Analyst Matthew Saperia retained his ‘reduce’ recommendation and £11 target price on the stock, which was trading up 3.3% at 822p on Monday afternoon.

‘Unite’s trading update shows that, as expected, students have returned en masse, driving full occupancy and an uplift to 2023/24 rental growth guidance,’ he said.

‘Top-line growth should help to mitigate cost pressures, including an average cost to debt now forecast to hit 3.8% next year.’

Saperia said the purpose-built student accommodation sector is ‘very well placed to deliver in the current environment’ but the shares already reflect this, trading on 20x 2022 earnings and a 4.1% yield.

Posted at 10/10/2022 06:48 by speedsgh
TRADING UPDATE AND Q3 FUND VALUATIONS - HTTPS://www.investegate.co.uk/unite-group-plc--utg-/rns/trading-update-and-q3-fund-valuations/202210100700072529C/

ACQUISITION OF PILOT BTR INVESTMENT - HTTPS://www.investegate.co.uk/unite-group-plc--utg-/rns/acquisition-of-pilot-btr-investment/202210100701062530C/

Posted at 20/9/2022 12:49 by sabzahmed
UTG taking a beating today.I was hoping it would be like Friday when it very quickly recovered, but that doesn't seem to be the case today.Assume it's just jitters before Thursday BoE interest decision. Hopefully we get calmer and better days after that.Or are there any other risks/issues anyone is aware of?
Posted at 17/8/2022 14:34 by maddox
Estate Agents Knight Frank have conducted a survey with UCSA that finds that Purpose Built Student Accommodation is better value than renting a room in HMO (house in multiple occupation). The gap was most extreme in London where it was found that students pay 33% less.

Students in HMOs are also going to be directly exposed to further gas and electricity price rises which must be a further concern.

htTPs://www.lettingagenttoday.co.uk/breaking-news/2022/8/agency-backing-purpose-built-student-accommodation-over-buy-to-let

Posted at 22/7/2022 23:37 by maddox
It's just over a month since UTG joined the FT100 and we are currently ranked at number 88. Which is a pretty solid position to have establish in such a short time.

Being an FTSE 100 stock; asset-backed; conservatively financed; uncorrelated with the general economy and with supportive market dynamics should be characteristics attractive to larger Financial Institutions. Also, as a Reit it will offer a growing dividend as their post-Covid-19 bounce-back is reflected in revenue generation.

1200p was breached for the first time today since Sept 2021 showing strength in a risk-off market. So, the stars are becoming aligned for UTG to break-out of its side-ways trading pattern and move back to higher ground.

Posted at 08/7/2022 08:19 by maddox
Lots of positives in todays' trading update from Unite but first we have the Quarterly Fund Valuation Report as at 30 June 22 for the two funds that Unite manages. These are in addition to Unite’s wholly owned student accommodation portfolio.

The two funds are:

USAF – Unite own 28.2% (up from 22% due to recent investment) - like-for-like asset value increased 3.5% during the quarter; and

LSAV – Unite own 50% - like-for-like asset value increased 4.0% during the quarter.

Just to emphasise those above jumps in valuation are quarterly not annual rises. This is reflecting the strong demand for this asset class by Institutional Investors - the RNS mentions the acquisition of Student Roost by GIC and Greystar announced in May. It also points out that we can expect to see a similar uplift to Unite's own portfolio of property. Student Accommodation is uncorrelated with the wider economy and is thus highly attractive in the face of a potential recession. It was the best performing property asset class during the 2008/9 Global Economic Crisis (GEC).

Outlook is highly positive based on the forward bookings for 2022/23 academic year an UTG are confident in achieving 97% occupancy. Much of the portfolio's rental rates are inflation linked and there is strong demand for the other direct-let beds; so the 3 - 3.5% rental rate growth guidance might be beaten.

UTG are highly exposed to utility costs and wage inflation - but have hedged their utility costs out to a 'substantial proportion' of 2024. Hopefully the current price pressures will wain before their protection winds-out. They have shown great foresight here and similarly they have locked-in their finance at the pre-fiscal tightening rates.

Clearly, Covid is still a risk, not least in China, but accepting that, UTG is emerging from the Covid-19 disruption in a strong position.

Posted at 23/2/2022 18:46 by maddox
Looking at the share price recently you'd think Putin had invaded Unite not Ukraine.

Yes, a very strong recovery is in-progress and the outlook for academic year (AY) 2022/23 is highly positive. The development pipeline is at an all-time high of 6000 beds(c.£1bn in value) that will increase the weighting 44% towards London (35%).

The dividends are recovering nicely with more to come as the Covid effect wears-off.

With the LTV ratio at 29% UTG have huge headroom should any peachy PBSA portfolio become available for acquisition.

On Covid IMHO the virus is following a clear evolutionary pathway where each new dominant variant is more infectious but less severe – making the likelihood of the emergence of a more serious variant highly unlikely. The 20+ different viruses that we refer to as 'the common cold' was each probably a deadly human pandemic in its time. So, I think that this threat is being over-exaggerated.

Some interesting strategic opportunities/initiatives were revealed today:

>> HMOs: The private landlord with Homes of Multiple Occupation (HMOs) rented to students is a specific target for UTG. UTG is already competitively priced with HMOs and landlords are now under significant new pressures to comply with energy efficiency standards. The cost of retrofitting insulation to old property to meet the minimum standards could be prohibitive. UTG have their electricity costs fully hedged in 2022 and 85% hedged for 2023, and gas (which accounts for less than 0.5% of rent) is hedged through 2023. HMO renters are unlikely to be as well protected from escalating energy prices.

>> Premium segments: UTG are also trialling greater segmentation of their portfolio to target some more premium-priced segments. One of these is the recently graduated professional requiring City Centre accommodation a.k.a build-to-rent. This closely associated market vertical could become an important new market for Unite and definitely something to watch.

So, a very welcome set of results and plenty of interesting growth opportunities in-sight. I'd recommend you listen to the replay of the presentation as there is far too many points of interest for me to only scratch the surface of in this summary:

httPs://webcasting.brrmedia.co.uk/broadcast/preview/61a62ec07aad4f60e33f6620

Regards, Maddox

Posted at 22/1/2022 08:52 by maddox
Hi BELtd,

For what is such an extremely resilient business model - it seems that the weather affects the Unite share price looking at the volatility. tbh I am always at a loss to rationalise the share price movements on a short term timeframe.

Essentially, these gyrations provide a good opportunity to pick-up shares at a better price. UTG is recovering strongly and potential Uni deals and current development pipeline will grow the value of the business. This growth trajectory is itself highly resilient and 'guaranteed growth' should command a premium. At some point, but who knows when, this will undoubtedly be reflected in the share price.

Regards, Maddox

Posted at 25/2/2021 17:34 by maddox
My StockSlam pick is a property company specialising in Purpose Built Student Accommodation (PBSA) –called Unite (LON:UTG) . It is by far the largest in this sector with c. 75,000 beds a Mkt Cap £3.4bn and features in the FT250. Its shares peaked at £13.38 in Feb 2020 but was then hit by Covid-19 and is now down at 963p (down about 27%). This price I think presents a good short-term buying opportunity with the end of Covid restrictions in sight.

Student Accommodation is a resilient investment, its asset backed and its market is uncorrelated with the general economy. Student Accommodation was the best performing property asset class during the Global Economic Crisis of 2008/9. One of Unite’s strengths is that 55% of its beds are guaranteed to be occupied by its agreement with Universities.

Unite (LON:UTG) is a REIT (Real Estate Income Trust), which allows exemption from UK corporation tax on its rental profits and to qualify as a REIT it has to distribute 90% of its income to investors by way of dividends. Which should be attractive to income seekers, but Unite's yield is relatively low, this is because it is expected to grow, both by its development pipeline and also by acquisition. It took over the markets' third largest player Liberty Living in 2019.

The Covid Impact: Covid-19 has hit Unite’s business - they released students from their contracts very early on, also given discounts and rental free periods. Typically, they would achieve 98% occupancy – but managed only 89% in 2020. So Covid has hit its income and consequently its property values have fallen.

Unite has published a Student Survey this morning:

https://www.investegate.co.uk/...

The findings are:

>> 77% students struggled with mental health and wellbeing as a result of Covid-19, but 84% say engaging in university life has been positive for their mental health;

>> Students' biggest challenge this year is the lack of face-to-face teaching, practical experience or facilities;

>> Traditional face-to-face university experience is key for students: 86% are keen to get onto university campus once it is safe to do so; 75% agree that living in university accommodation and being on campus is as important a part of the university experience as lectures and tutorials; and

>> Four in five (79%) students would like a return to face-to-face tuition after the Easter break.

This based on a survey of 2000 students.

Covid-19 has been very instructive: It has demonstrated just how robust the demand is for the 'university experience'. Going to University is clearly a culturally entrenched 'right of passage' for the UK's young adults.

It has often been postulated that on-line learning would disrupt this tradition. Covid-19 has provided the opportunity to test this hypothesis. Whilst, on-line learning has clearly allowed teaching to continue during the Covid-19 Lockdowns - it is certainly not a substitute for the uni experience. Students want the 'real-life' full-fat university experience - it's not just about learning (https://www.bbc.co.uk/iplayer/...) ;-)

These are two extremely significant points for anyone assessing the risks of investing in this sector. So, I’m expecting a full recovery in demand once Covid-19 restrictions are removed.

The market back-ground is supportive: The market is under-supplied, there is a short-fall of c. 243k beds of those required for first years and international students - that universities like of offer 'in-hall' accommodation.

Secondly demand is growing: Demographics are positive - the number of 17/18 year olds is increasing - and, a higher proportion of them are opting to go to university.

The Government has at long last recognised the value of international students to the UK. The Govt has changed the rules to now allow foreign students studying in the UK to stay-on to work for a further two years. Also, the Govt are targeting to increase the number of international students by c. 33% to 600k by 2030 - from c. 450k previously.

In addition to income Unite also offers growth: It has a development pipeline of 5000+ new beds to be delivered by 2024. It raised £300m in June 2020 by way of a placing at 870p – now you might think that this was to repair the balance sheet – but no it was to take advantage of depressed land prices and fund the acquisition of three more prime development sites. It has a strong balance sheet with a 33% debt to asset value ratio.

To summarise: Covid-19 presents the opportunity to get on-board this high quality REIT that offers the prospects of both growth and income. With the end of Covid restrictions now in-sight I’m expecting to see a full recovery in demand for Unite's accommodation and a bounce in the share price. But, due to its resilient market, this is a share I’m very happy to hold in the face of a possible UK recession.

Maddox

(Declaration: I am very long Unite (LON:UTG))
/////////////////////////////////////////////////////////////////////

and in answer to some questions:

Watkin Jones (LON:WJG) is a great business but I haven't invested. I particularly like that they de-risk their business by pre-selling their developments and thus finance their developments using the customer's cash - perfect.

I favour Unite (LON:UTG) because it retains its developed PBSA assets and is thus inexorably growing in size and efficiency. WJG OTOH has to keep expanding its development operations in order to grow - this will at some point cause difficulties.

£UTG has a further advantage over Empiric Student Property (LON:ESP) and CPG Student Living (LON:DIGS) in its unique capital structure that provides substantially greater financial deal capacity. Its property development and management company is supported by two own managed property funds. This distinguishes it strategically from it's competitors, the funds are:

USAF £2.8bn – Unite own c.22%; and

LSAV £1.3bn – Unite own 50%.

This means that Unite (LON:UTG) is not restrained by its own balance sheet debt capacity (a conservative 33% debt to value), once the yield on a developed property matures it can sell the property into the funds and re-finance its development pipeline. The funds can also be leveraged in takeovers, such as Aston University's Campus and Liberty Living.

The financial firepower that this structure provides is a key strategic advantage in what is likely to be a consolidating sector.

\\\\\\\\\\\\\\\
Cladding - Grenfell tragedy

Unite have been hit by this dreadful scandal but are in a good position to quickly fix it. They have 19 buildings with unsafe cladding, which will be removed within the next 12 months at a total estimated cost of about £15 - £20m.

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