Quick Take: MREIT's acquisitions and 3 more market updates
MREIT [MREIT 14.66 3.2%] [link] received SEC approval for the acquisition of four “prime” office properties from its parent company, Megaworld [MEG 2.00 3.4%], valued at P5.4 billion. MREIT will pay for the properties by issuing 263,700,000 common MREIT shares to MEG, pricing the deal at P20.00 per MREIT share. MREIT noted that this is 41% higher than MREIT’s market price. MREIT also noted that the occupancy rate of the new towers is 96%, which is marginally higher than its existing occupancy rate of 95%, but noticeably lower than the occupancy rates of its office space REIT peers, AREIT [AREIT 34.20 0.6%] (97%) and RL Commercial REIT [RCR 5.68 0.5%] (99%).
MB Quick Take: MREIT said that it will recognize income from the new properties starting on January 1st of 2023, so this income should show up in MREIT’s Q1/23 financial statements, and should provide a boost to its Q1/23 dividend, which shareholders should probably appreciate because MREIT’s dividend has been trending lower for two consecutive quarters.
Semirara Mining and Power [SCC 30.95 2.3%] [link] declared P3.50/share in regular and special dividends from FY22 operations. The dividends are payable on April 25 to SCC shareholders of record on April 13. Relative to SCC’s closing price yesterday, the combined dividend’s yield is 11.3%.
MB Quick Take: This is the kind of dividend that will make mouths water, but it’s perhaps something of a cold comfort to all of those investors that jumped into SCC over P40/share at the height of its surge in early Q4/22. For those people, this dividend’s yield is closer to 8.50%.
FMETF [FMETF 102.50 0.5%] [link] was halted for 2.5 hours yesterday because the iNAV calculation was not updating correctly. The iNAV value is the real-time value of the shares that are owned by FMETF, and the correct display of this number is a crucial piece of information that investors need to properly price the FMETF security.
MB Quick Take: This is the fourth time since September of 2022 that FMETF has been halted during live trading to solve this specific problem. I feel like I have better uptime for some of my data sources that I collect using a goofy system of terrible scraping code and overly-complicated Google Sheets formulas that are prone to a wide variety of (human) errors. For an error that is so common, it’s a little bit weird that it (1) continues to happen, and (2) takes so long to resolve. The iNAV first stopped updating at 10:30, and wasn’t restored until 2:30. In a trading day that’s only 4.5 hours long, being down for 3 hours is kind of a big deal.
Global Ferronickel [FNI 2.45 2.9%] [link] teased FY22 net income of P2.2 billion, up 9%. FNI said that total ore shipped for FY22 was down 24% due to bad weather, but that revenues only fell 13% due to the higher quality of ore mix and favorable forex exchange.
MB Quick Take: The increased production from the Palawan mine will help, but that too will be impacted by rain delays and storms. FNI is one of those stocks where the execution of the management team can be saved or killed by factors that are largely beyond their control, like market prices of ore and the weather. That’s why I’m interested to see FNI trying to climb the value chain by building investing heavily in a steel mill and port facility in Bataan; the higher up the value chain, the less severe the peaks and valleys from these forces beyond that are beyond the power of the boardroom to control.
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Merkado Barkada's opinions are provided for informational purposes only, and should not be considered a recommendation to buy or sell any particular stock. These daily articles are not updated with new information, so each investor must do his or her own due diligence before trading, as the facts and figures in each particular article may have changed.
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