Market's view on Empiric
Published on April 2024
- Positive results and outlook with EPS up by 17% and asset value increased by 4.6%, ahead of 2023 in bookings for the next academic year.
- Concerns raised about the potential impact of the budget announcement on PBSA holders, specifically the removal of MDR which could lead to valuation reductions.
- A discussion on the risks and returns of student accommodation investments, with a focus on yield and opportunities in the REIT space.
- Updates on company operations mentioned, including full capacity for the 23-24 academic year, potential property disposals, a joint venture being considered, refurbishment plans, and a dividend increase.
- The company’s resilience and ability to extract maximum value from assets were highlighted, despite concerns about the investment model’s attractiveness in the current macroeconomic environment.
- Observations on the company’s financial performance including a lackluster dividend and a return on equity that was considered unimpressive.
- Suggestions that the company needs to be taken private due to ongoing challenges with dividend and profitability.
- Comparisons made with other investment opportunities within the sector, indicating a preference for other companies perceived as offering better value.
- Speculations on potential improvements in company returns with the appointment of a joint venture partner.