UOB Kay Hian analyst Jonathan Koh has maintained their bullish stance on PRKWF stock, giving a Buy rating on February 7.
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Jonathan Koh has given his Buy rating due to a combination of factors, primarily highlighting Parkway Life REIT’s robust position in the healthcare sector. The REIT is deemed a stable investment, benefiting from its healthcare focus and a solid Weighted Average Lease Expiry (WALE) of 15.3 years, which ensures consistent income streams. Additionally, its low aggregate leverage of 34.8% underscores financial stability.
Another critical factor for the Buy rating is the strategic acquisition of 11 nursing homes in France, which is expected to enhance revenue. Although the acquisition only contributed for 12 days in 2024, it promises a Net Property Income (NPI) yield of 6.5%, showing potential for future growth. Furthermore, the increase in property values, particularly in Singapore, reflects the burgeoning healthcare sector, further supporting the REIT’s growth prospects. Despite higher finance costs due to recent acquisitions, these are capitalized, minimizing their impact on distributions, thus maintaining a positive outlook on the REIT’s performance.
According to TipRanks, Koh is a 3-star analyst with an average return of 1.9% and a 47.50% success rate. Koh covers the Real Estate sector, focusing on stocks such as Mapletree Logistics, Frasers Logistics & Commercial Trust, and Keppel REIT.
In another report released on February 7, DBS also maintained a Buy rating on the stock with a S$4.75 price target.