DBS analyst Jeff Yau maintained a Buy rating on Sunlight Real Estate Investment (SHTRF – Research Report) yesterday and set a price target of HK$2.43.
Jeff Yau has given his Buy rating due to a combination of factors that highlight the resilience and potential of Sunlight Real Estate Investment Trust. The REIT’s balanced portfolio of office and retail assets in key commercial areas of Hong Kong provides a stable income stream, even amidst global economic uncertainties. This strategic mix, particularly its Grade B office spaces catering to SMEs and service trade tenants, makes it less susceptible to fluctuations in office leasing demand.
Additionally, the REIT’s valuation is considered attractive, with the potential inclusion in the Stock Connect expected to enhance investor sentiment. Despite challenges in the commercial sector, Sunlight REIT offers a compelling distribution yield of 9.7-9.5% for FY25-26, which is significantly above its historical average. These factors, combined with a target price of HKD2.43 based on a Discounted Dividend Model, underpin Jeff Yau’s Buy recommendation.
According to TipRanks, Yau is an analyst with an average return of -5.6% and a 44.05% success rate. Yau covers the Real Estate sector, focusing on stocks such as Henderson Land Development Co, Kerry Properties, and CK Asset Holdings.