FoggyIsle.XYZ | Market's view on Tritax Eurobox

A stock watcher noted the historical rise of SUPR to the mid 70s after a target of 60p from Jefferies, suggesting a similar trajectory for EBOX due to acceptance of higher rates for longer or a reversion of mid-term risk-free rates to 4-4.5%. They highlighted that achieving a 12% IRR requires a sensibly long holding period, and mentioned trading against set prices like 48p on EBOX and 71p on SUPR.
Another watcher suggested EBOX could be a takeover candidate once there is more clarity on European rates and their refinancing, comparing it with bigger peers like Catena that trade on much higher multiples.
Concerns were raised about the marginal miss on dividend cover by EBOX, given the short-term context could be overshadowed by targeted 4% annual rises in dividends, despite potentially slow rate reductions. The discord between US and European/UK economic fundamentals was also discussed.
The refinancing of CTP earlier in the year at 4.8% led to discussions about the uncomfortable increase in interest from €4.75 million to €23.75 million, potentially affecting dividend sustainability.
There was a mention of significant risk for REITs with debts needing refinancing in the near future, particularly in response to rising Bund yields, which could impact their earnings significantly.
Positive refinancing news from Schroder European Real Estate Investment Trust was shared, successfully refinancing a €8.6 million loan with conditions considered supportive of current values and liquidity.
The sensitivity of the market to interest rate changes was highlighted, with a stock watcher noting the significant impact of rate movements on stocks like EBOX, due to their Euro-based operations.
One stock watcher expressed frustration and decided to exit their position, citing challenges and foreseeing a potential revisit to recent lows if rate drops seem unlikely.
Cromwell’s financials were critiqued as complicated, with several adjustments affecting net property income and challenges in assessing the potential investment due to intricate risk factors, including government interventions in Italy.
Comparison of EBOX with Cromwell European REIT revealed a significant discount to NAV and a high dividend yield, prompting discussions on valuation and investment attractiveness.