ASX:ARF

Stock Analysis Report

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Executive Summary

Arena REIT is an ASX300 listed property group that owns, manages and develops social infrastructure properties across Australia. More Details


Snowflake Analysis

Adequate balance sheet and fair value.

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

4.2%

ARF

1.8%

AU REITs

0.6%

AU Market


1 Year Return

-3.8%

ARF

-16.3%

AU REITs

-12.3%

AU Market

Return vs Industry: ARF exceeded the Australian REITs industry which returned -16.3% over the past year.

Return vs Market: ARF exceeded the Australian Market which returned -12.3% over the past year.


Shareholder returns

ARFIndustryMarket
7 Day4.2%1.8%0.6%
30 Day15.5%4.6%-3.6%
90 Day16.5%2.6%1.0%
1 Year1.5%-3.8%-12.8%-16.3%-9.0%-12.3%
3 Year40.8%19.6%19.8%3.6%17.1%2.0%
5 Year129.2%73.0%48.7%15.8%44.8%14.3%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Arena REIT undervalued compared to its fair value and its price relative to the market?

19.8%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ARF (A$2.75) is trading below our estimate of fair value (A$3.43)

Significantly Below Fair Value: ARF is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: ARF is good value based on its PE Ratio (10.8x) compared to the AU REITs industry average (15.7x).

PE vs Market: ARF is good value based on its PE Ratio (10.8x) compared to the Australian market (20.1x).


Price to Earnings Growth Ratio

PEG Ratio: ARF's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: ARF is overvalued based on its PB Ratio (1.4x) compared to the AU REITs industry average (1x).


Next Steps

Future Growth

How is Arena REIT forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

-0.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ARF's earnings are forecast to decline over the next 3 years (-0.5% per year).

Earnings vs Market: ARF's earnings are forecast to decline over the next 3 years (-0.5% per year).

High Growth Earnings: ARF's earnings are forecast to decline over the next 3 years.

Revenue vs Market: ARF's revenue (2.9% per year) is forecast to grow slower than the Australian market (4.4% per year).

High Growth Revenue: ARF's revenue (2.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ARF's Return on Equity is forecast to be low in 3 years time (7.1%).


Next Steps

Past Performance

How has Arena REIT performed over the past 5 years?

-3.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ARF has a large one-off gain of A$31.0M impacting its June 30 2020 financial results.

Growing Profit Margin: ARF's current net profit margins are higher than last year .


Past Earnings Growth Analysis

Earnings Trend: ARF's earnings have declined by 3.6% per year over the past 5 years.

Accelerating Growth: ARF's earnings growth over the past year (29.1%) exceeds its 5-year average (-3.6% per year).

Earnings vs Industry: ARF earnings growth over the past year (29.1%) exceeded the REITs industry 6.8%.


Return on Equity

High ROE: ARF's Return on Equity (10.2%) is considered low.


Next Steps

Financial Health

How is Arena REIT's financial position?


Financial Position Analysis

Short Term Liabilities: ARF's short term assets (A$86.0M) exceed its short term liabilities (A$33.5M).

Long Term Liabilities: ARF's short term assets (A$86.0M) do not cover its long term liabilities (A$227.2M).


Debt to Equity History and Analysis

Debt Level: ARF's debt to equity ratio (30.2%) is considered satisfactory.

Reducing Debt: ARF's debt to equity ratio has reduced from 43.1% to 30.2% over the past 5 years.

Debt Coverage: ARF's debt is not well covered by operating cash flow (18.5%).

Interest Coverage: ARF's interest payments on its debt are well covered by EBIT (5.6x coverage).


Balance Sheet


Next Steps

Dividend

What is Arena REIT current dividend yield, its reliability and sustainability?

5.09%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: ARF's dividend (5.09%) is higher than the bottom 25% of dividend payers in the Australian market (2.38%).

High Dividend: ARF's dividend (5.09%) is low compared to the top 25% of dividend payers in the Australian market (5.69%).


Stability and Growth of Payments

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

Growing Dividend: ARF's dividend payments have increased, but the company has only paid a dividend for 7 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (56%), ARF's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ARF's dividends in 3 years are forecast to be covered by earnings (99.3% payout ratio).


Next Steps

Management

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

2.3yrs

Average management tenure


CEO

Rob de Vos

1.58yrs

Tenure

AU$1,036,293

Compensation

Mr. Robert Andrew de Vos, also known as Rob, has been CEO, Managing Director and Director at Arena REIT since February 19, 2019. Mr. de Vos served as Head of Property at Arena REIT until February 19, 2019, ...


CEO Compensation Analysis

Compensation vs Market: Rob's total compensation ($USD758.08K) is about average for companies of similar size in the Australian market ($USD952.72K).

Compensation vs Earnings: Rob's compensation has increased by more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Robert de Vos
CEO, MD & Director1.58yrsAU$1.04m0.13%
A$ 1.2m
Gareth Winter
Company Secretary5.75yrsAU$839.05k0.14%
A$ 1.3m
Samantha Rist
Head of Investor Relations2.25yrsno datano data
Joanne Ross
Head of Risk & Compliance - Arena REIT Management Limitedno datano datano data
Stuart Andrews
Head of Portfolio Management1.67yrsno datano data
Kimberly Allen
Fund Financial Controller - Arena REIT Management Limited8.67yrsno datano data

2.3yrs

Average Tenure

Experienced Management: ARF's management team is considered experienced (2.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Robert de Vos
CEO, MD & Director1.58yrsAU$1.04m0.13%
A$ 1.2m
Gareth Winter
Company Secretary5.75yrsAU$839.05k0.14%
A$ 1.3m
Dennis Wildenburg
Independent Non-Executive Director8.75yrsAU$120.00k0.051%
A$ 476.7k
Simon Parsons
Independent Non-Executive Director8.42yrsAU$115.00k0.064%
A$ 598.5k
David Ross
Independent Non-Executive Chairman7.92yrsAU$207.00k0.063%
A$ 587.3k
Rosemary Hartnett
Independent Non Executive Director1.08yrsAU$101.80k0.0029%
A$ 27.0k

6.8yrs

Average Tenure

Experienced Board: ARF's board of directors are considered experienced (6.8 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 14.1%.


Top Shareholders

Company Information

Arena REIT's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Arena REIT
  • Ticker: ARF
  • Exchange: ASX
  • Founded: 2014
  • Industry: Health Care REITs
  • Sector: Real Estate
  • Market Cap: AU$936.078m
  • Shares outstanding: 340.39m
  • Website: https://www.arena.com.au

Location

  • Arena REIT
  • 41 Exhibition Street
  • Level 5
  • Melbourne
  • Victoria
  • 3000
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ARFASX (Australian Securities Exchange)YesOrdinary Stapled UnitsAUAUDJun 2013
ARFCHIA (Chi-X Australia)YesOrdinary Stapled UnitsAUAUDJun 2013

Biography

Arena REIT is an ASX300 listed property group that owns, manages and develops social infrastructure properties across Australia. Our current portfolio of social infrastructure properties is leased to a div ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/09/19 19:05
End of Day Share Price2020/09/18 00:00
Earnings2020/06/30
Annual Earnings2020/06/30


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.