Analyst John Cahill of Stifel Nicolaus maintained a Buy rating on Hammerson plc R.E.I.T. (HMSO – Research Report), with a price target of p300.00.
John Cahill’s rating is based on Hammerson’s transformative year, highlighted by the significant sale of its Value Retail investments, which has allowed the company to restructure its balance sheet and focus on growth. The company has successfully disposed of £1.5 billion in non-core assets over the past four years, enabling it to concentrate on increasing rents and acquiring joint venture partners.
The outlook for Hammerson has improved as internet retail growth has slowed, stabilizing physical retail property rents. With a high occupancy rate of 95% and a like-for-like rental growth of 2%, the company is well-positioned for future earnings growth. Cahill anticipates that Hammerson will achieve above-inflation earnings growth, forecasting a compound annual growth rate of 8.1% over the next three years, which supports his Buy rating.