Last week, the REITS industry hasn't moved much but Fortress REIT is up 3.9% in that time. Furthermore, the industry has been flat for the past year as well. As for the next few years, earnings are forecast to decline by 22% per annum.
Industry Valuation and Performance
Has the South African REITS Industry valuation changed over the past few years?
Investors are pessimistic on the South African REITs industry, indicating that they anticipate long term growth rates will be lower than they have historically.
The industry is trading at a PE ratio of 8.0x which is higher than its 3-year average PE of -0.022x.
The industry is trading close to its 3-year average PS ratio of 3.6x.
Past Earnings Growth
The earnings for companies in the REITs industry have grown 28% per year over the last three years, while revenues have remained mostly flat.
This means that companies overall are more efficiently conducting business since profits are increasing while sales have been flat.
Which industries have driven the changes within the South African Real Estate industry?
Hotel and Resort REITs
Investors are most optimistic about the Industrial REITs industry even though it's trading below its 3-year average PE ratio of 29.4x.
It looks like they are confident that earnings will grow faster in the future than they have historically.
Despite it being negative, analysts are least pessimistic on the Diversified REITs industry since they expect its earnings to decline by only 22% per year over the next 5 years, which isn't as bad as the other industries.
This is a reversal from its past annual earnings growth rate of 107% per year.
In contrast, the Diversified REITs industry is expected to see its earnings decline by 22% per year over the next few years.
Top Stock Gainers and Losers
Which companies have driven the market over the last 7 days?