ASX:AQR

Stock Analysis Report

APN Convenience Retail REIT

Executive Summary

APN Convenience Retail REIT (ASX code: AQR) is a listed Australian real estate investment trust which owns high quality Australian service stations and convenience retail assets.


Snowflake Analysis

Average dividend payer with moderate growth potential.

Share Price & News

How has APN Convenience Retail REIT's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: AQR has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

2.8%

AQR

0.7%

AU REITs

0.02%

AU Market


1 Year Return

33.4%

AQR

15.6%

AU REITs

14.6%

AU Market

Return vs Industry: AQR exceeded the Australian REITs industry which returned 15.6% over the past year.

Return vs Market: AQR exceeded the Australian Market which returned 14.6% over the past year.


Shareholder returns

AQRIndustryMarket
7 Day2.8%0.7%0.02%
30 Day8.1%2.6%0.2%
90 Day17.0%5.4%5.4%
1 Year42.4%33.4%21.1%15.6%19.7%14.6%
3 Yearn/a52.9%30.9%38.7%20.2%
5 Yearn/a89.3%47.0%50.6%17.1%

Price Volatility Vs. Market

How volatile is APN Convenience Retail REIT's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is APN Convenience Retail REIT undervalued compared to its fair value and its price relative to the market?

28.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: AQR (A$3.99) is trading below our estimate of fair value (A$5.6)

Significantly Below Fair Value: AQR is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: AQR is poor value based on its PE Ratio (19.6x) compared to the REITs industry average (15.4x).

PE vs Market: AQR is poor value based on its PE Ratio (19.6x) compared to the Australian market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: AQR is poor value based on its PEG Ratio (1.9x)


Price to Book Ratio

PB vs Industry: AQR is overvalued based on its PB Ratio (2.5x) compared to the AU REITs industry average (1.2x).


Next Steps

Future Growth

How is APN Convenience Retail REIT forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

10.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AQR's forecast earnings growth (10.5% per year) is above the savings rate (1.1%).

Earnings vs Market: AQR's earnings (10.5% per year) are forecast to grow faster than the Australian market (9.3% per year).

High Growth Earnings: AQR's earnings are forecast to grow, but not significantly.

Revenue vs Market: AQR's revenue (4.7% per year) is forecast to grow faster than the Australian market (4.2% per year).

High Growth Revenue: AQR's revenue (4.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: AQR's Return on Equity is forecast to be low in 3 years time (9%).


Next Steps

Past Performance

How has APN Convenience Retail REIT performed over the past 5 years?

30.3%

Last years earnings growth


Earnings and Revenue History

Quality Earnings: AQR has a large one-off gain of A$9.3M impacting its December 31 2019 financial results.

Growing Profit Margin: AQR's current net profit margins (51.1%) are higher than last year (40.5%).


Past Earnings Growth Analysis

Earnings Trend: Insufficient data to determine if AQR's year-on-year earnings growth rate was positive over the past 5 years.

Accelerating Growth: Insufficient data to compare AQR's past year earnings growth to its 5-year average.

Earnings vs Industry: AQR earnings growth over the past year (30.3%) exceeded the REITs industry -3.4%.


Return on Equity

High ROE: AQR's Return on Equity (10%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is APN Convenience Retail REIT's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: AQR has a high level of physical assets or inventory.

Debt Coverage by Assets: AQR's debt is not covered by short term assets (assets are 0.1x debt).


Financial Institutions Analysis

Asset Level: AQR's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if AQR has a sufficient allowance for bad loans.

Low Risk Liabilities: AQR reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if AQR has an acceptable proportion of non-loan assets held.

Low Risk Deposits: AQR has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if AQR has an appropriate level of bad loans.


Next Steps

Dividend

What is APN Convenience Retail REIT's current dividend yield, its reliability and sustainability?

5.46%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: AQR's dividend (5.46%) is higher than the bottom 25% of dividend payers in the Australian market (2.29%).

High Dividend: AQR's dividend (5.46%) is in the top 25% of dividend payers in the Australian market (5.39%)


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, AQR has been paying a dividend for less than 10 years.

Growing Dividend: AQR's dividend payments have increased, but the company has only paid a dividend for 2 years.


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (92.7%), AQR's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: AQR's dividends in 3 years are forecast to be thoroughly covered by earnings (1% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

8.1yrs

Average board tenure


CEO

APN Convenience Retail REIT has no CEO, or we have no data on them.


Board Members

NamePositionTenureCompensationOwnership
Geoffrey Brunsdon
Independent Non-Executive Chairman of APN Funds Management Limited8.1yrsno data0.063% A$235.4k
Michael Johnstone
Independent Non-Executive Director APN Funds Management Limited11.1yrsno datano data
Howard Brenchley
Independent Director APN Funds Management Limited22.1yrsno data0.051% A$191.7k
Jennifer Horrigan
Independent Non-Executive Director of APN Funds Management Limited8.1yrsno datano data
Joseph Rango
Alternate Director1.1yrsno datano data

8.1yrs

Average Tenure

63yo

Average Age

Experienced Board: AQR's board of directors are considered experienced (8.1 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 4%.


Top Shareholders

Company Information

APN Convenience Retail REIT's company bio, employee growth, exchange listings and data sources


Key Information


Location

  • APN Convenience Retail REIT
  • 101 Collins Street
  • Level 30
  • Melbourne
  • Victoria
  • 3000
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
AQRASX (Australian Securities Exchange)YesStapled SecuritiesAUAUDJul 2017

Biography

APN Convenience Retail REIT (ASX code: AQR) is a listed Australian real estate investment trust which owns high quality Australian service stations and convenience retail assets. The Fund’s portfolio of 72 properties valued at approximately $389 million, is predominantly located on Australia’s eastern seaboard and is leased to leading Australian and international convenience retail tenants. The portfolio provides a long lease expiry profile and contracted annual rent increases delivering the Fund a sustainable and strong level of income security. Convenience Retail has a target gearing range of 25 – 40% as part of its conservative approach to capital management. APN Convenience Retail REIT is governed by an Independent Board of Directors and is managed by APN Property Group, a specialist real estate investment manager established in 1996 with approximately $2.9 billion in assets under management. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/24 10:59
End of Day Share Price2020/02/24 00:00
Earnings2019/12/31
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.