Cedar Woods Properties
About the author:
- Author name:
- By Scott Murdoch
- Job title:
- Senior Analyst
- Date posted:
- 27 February 2014, 9:38 AM
- Sectors Covered:
- Diversified Financials, Professional Services
Cedar Woods Properties (CWP) 1H14 result (up 13%) positions the company to achieve FY14 NPAT guidance of +10% on the pcp.
While we thought strong conditions in Western Australia may have resulted in an upgrade, CWP's project pipeline, strong balance sheet and sector conditions all auger well for consistent medium-term growth.
The results
CWP reported 1H14 NPAT of A$20.5m, up 13% on the pcp and in-line with our A$21m forecast. An interim dividend of 12cps was declared, up 12% on the pcp.
Revenue of A$102.1m was strong, up 39% on the pcp and up 2.3% on 2H13. EBIT was up 7% on the pcp, with result composition slightly weaker than anticipated (NPAT assisted by a lower tax rate of 26% and higher capitalised interest). Gearing of 21% (ND/E) remains conservative.
The outlook
CWP's medium-term growth outlook is supported by:
- solid sector conditions
- a mature development pipeline
- strong balance sheet and funding position
- embedded profit in WLTC
- a proven track record
Our view
CWP continues to offer higher earnings visibility and reliability than peers, while trading on lower multiples. Trading on 11.8x FY15 PE, we maintain our Add recommendation and a share price target of A$7.60.
More information
If you are interested in finding out more about Cedar Wood Properties (CWP), please contact your nearest Morgans office.
Disclaimer(s): Analyst owns shares.
The information contained in this report is provided to you by Morgans Financial Limited as general advice only, and is made without consideration of an individual's relevant personal circumstances. Morgans Financial Limited ABN 49 010 669 726, its related bodies corporate, directors and officers, employees, authorised representatives and agents (“Morgans”) do not accept any liability for any loss or damage arising from or in connection with any action taken or not taken on the basis of information contained in this report, or for any errors or omissions contained within. It is recommended that any persons who wish to act upon this report consult with their Morgans investment adviser before doing so.
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