‘Condo REITs can stand out in 2023′: Scotiabank analyst

Each day roundup of analysis and evaluation from The Globe and Mail’s market strategist Scott Barlow

Scotiabank REIT analyst Mario Saric is bullish on condo REITs,

“We expect Condo REITs can standout in 2023. CAD Condo REITs are up 10 per cent year-to-date vs. 7 per cent for CAD REITs and three per cent for U.S. Condo REITs, recovering some 2022 weak point (down 22 per cent vs. down 16 per cent vs. down 34 per cent). We expect one driver = accelerating market lease development vs. decelerating U.S. development. Our 2023E AFFOPU [adjusted funds from operations per unit] = 116 per cent of 2019 (i.e. pre-COVID), the Third-best in Canada, whereas 8-per-cent a number of erosion matches sector avg.. Occupancy and lease exceed pre-COVID for BEI, CAR, and KMP, with IIP and Minto shut on occupancy. Whereas price strain is topical (sentiment was break up; some felt it peaked; others much less positive) sturdy SSREV [same store revenue] may drive the very best fee of change in SSNOI [same store net operating income] development ex. Workplace”

“Scotiabank likes condo REITs” – (analysis excerpt) Twitter

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For aggressive traders, Morgan Stanley has collected 10 commerce concepts for the present earnings season. The names for bullish outcomes are Bathtub and Physique Works Inc., CNH Industrial NV, Constellation Power Corp., EnLink Midstream LLC, Marriott Worldwide Inc. and NOV Inv. The quick concepts are Shiny Horizons Household Options Inc., Freshworks Inc., Palantir Applied sciences Inc. and Snap Inc.

Familiarity is more likely to lead Canadian merchants to Bathtub and Physique Works…,

“We see as a lot as 11 per cent upside to 4Q consensus EPS experiences (February 22). Additional, whereas specialty retail shares have risen 2.0 per cent because the ICR convention, BBWI is down 1.0 per cent, indicating that this potential beat has not been priced in.”

… and Snap,

“We anticipate Snap to overlook 4Q income and information 1Q beneath the road (earnings on January 31). We forecast 4Q income fell [approximately] 2.0 per cent 12 months over 12 months, with December declining [approximately] 10.0 per cent 12 months over 12 months”

“MS: 10 trades for earnings season” – (desk) Twitter

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Company revenue and income steering amidst a worldwide financial system slowed by central financial institution financial tightening is arguably an important pattern for traders to comply with within the coming weeks.

BofA Securities world quantitative strategist Nigel Tupper is following the information intently,

“Globally, gross sales forecasts at the moment are falling in tandem with earnings forecasts. The International Earnings Revision Ratio [number of companies raising guidance versus lowering guidance] had improved in December in response to China reopening optimism however fell in January from 0.82 to 0.64 as earnings optimism pale. This month, the International Gross sales Revision Ratio fell beneath 1.00 (from 1.02 to 0.86) as top-line estimates began falling in tandem with earnings estimates. The International Gross sales Revision Ratio was dragged down by massive falls in Power, Supplies, and Software program and this Ratio is now beneath 1.00 in eleven of sixteen world sectors in a sign of top-line fragility. The fairness market rally this 12 months has not been pushed by power in earnings or gross sales… As central banks proceed to hike to handle inflation, the Earnings Revision Ratio stays beneath 1.00 in all areas, all world types, and virtually all world sectors … At the moment, the Earnings Revision ratio is meaningfully above world averages for Aerospace IT Companies (3.50), Petroleum Water Transport (2.66), Oil/Fuel Properly Drilling (2.24) and Well being Plan Suppliers (2.00)”

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Diversion: “McKinsey contracts high $100M beneath Justin Trudeau” – CBC

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