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magazineSupermarket Income REIT appeals as a steady investment purely for dividends
Supermarket Income REIT (SUPR) 109.7p
Gain to date: 4.5%
Original entry point: Buy at 105p, 2 April 2020
The share price return delivered by Supermarket Income REIT (SUPR) over the last 11 months may not be enough to quicken the pulses but a very steady performance along with a reliable inflation-linked income stream looks attractive after the recent volatility in the bond market.
Results for the six months to 31 December 2020 (2 Mar) reflect the series of acquisitions the company has made with rental income up 76% and pre-tax profit increasing 323.1%. The company raised £200 million to invest in a pipeline of assets in October 2020.
The portfolio’s weighting towards omni-channel supermarkets – located in good locations and able to fulfil online orders and serve shoppers in-store – has been a winning strategy during the Covid-19 pandemic.
Investment bank Jefferies says: ‘Earnings per share were up 12% to 2.8p with the dividend per share (DPS) rising with inflation to 2.93p (+1.7%) with progress made on dividend cover, whilst post-period end acquisitions should see DPS fully covered on an earnings basis which is a positive step.’
SHARES SAYS: We think Supermarket Income remains a lower risk and attractive option for income investors, offering a forward yield 5.4% of based on consensus forecasts.
Important information:
These articles are provided by Shares magazine which is published by AJ Bell Media, a part of AJ Bell. Shares is not written by AJ Bell.
Shares is provided for your general information and use and is not a personal recommendation to invest. It is not intended to be relied upon by you in making or not making any investment decisions. The investments referred to in these articles will not be suitable for all investors. If in doubt please seek appropriate independent financial advice.
Investors acting on the information in these articles do so at their own risk and AJ Bell Media and its staff do not accept liability for losses suffered by investors as a result of their investment decisions.
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