Grainger Plc: Investment Case
Summary
- New position opened: Grainger PLC.
- It’s the biggest landlord in the United Kingdom.
- It’s aggressively increasing its real estate assets' portfolio, banking on a structural house shortage in London and several other British counties.
I think the house market is the correct place to be right now, from an investor's viewpoint.
Grainger PLC (LONDON:GRI) is the biggest landlord in the UK and it has projects well financed to almost double its size in the years to come.
British house market is characterized by a structural house shortage and a huge renting demand, given the average high prices.
In this situation it should be a good idea to bet on a British house developer, which is also a landlord, like GRI.
Its dividend yield is less than 1.8% at the moment but it's growing and the payout ratio is less than 50% (GRI is not a REIT). I believe that when it will reach the target assets size, it will change its structure and become a REIT, significantly increasing the payout. Moreover, British dividends are not subjected to withholding tax.
Valuation is compelling: it is now trading at around NAV.
Check out the investment thesis here.
Do not forget to “follow” me, pushing the special button on this page.
Cheers,
Gio
Analyst's Disclosure: I/we have a beneficial long position in the shares of Grainger PLC either through stock ownership, options, or other derivatives.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.