Mapletree Commercial Trust: Undervalued REIT with Strong Growth Potential and Resilient Assets

DBS analyst Geraldine Wong maintained a Buy rating on Mapletree Commercial (MPCMF – Research Report) on April 25 and set a price target of S$1.80.

Geraldine Wong’s rating is based on the attractive valuation and growth potential of Mapletree Commercial. The REIT is considered undervalued, with yields exceeding 6%, which is notably higher than other large-cap S-REITs. This is supported by the ownership of two significant assets in Singapore, VivoCity and Mapletree Business City, which provide income stability and resilience.
Additionally, the REIT is well-positioned to benefit from potential interest rate cuts, which could enhance its distribution per unit. The recent divestment of Mapletree Anson has strengthened its balance sheet, and further asset divestments may streamline the portfolio for future growth. Despite concerns about the Festival Walk asset, the market conditions suggest that its book values are achievable, indicating a positive outlook for cash flows and overall performance.

Wong covers the Real Estate sector, focusing on stocks such as CapitaLand Mall, Ascott Residence, and Frasers Centrepoint. According to TipRanks, Wong has an average return of -1.6% and a 42.11% success rate on recommended stocks.

In another report released yesterday, UOB Kay Hian also maintained a Buy rating on the stock with a S$1.62 price target.