Supermarket Income REIT PLC (LSE:SUPR, OTC:SUPIF) remains a solid investment option in an uncertain macro environment, according to broker RBC.
Shares have been strong performers recently but still have plenty of appeal, suggests the broker.
RBC has a 140p share price target, which implies 16% return potential and reflects Supermarket Income's long leases, which are primarily to leading UK grocers and linked to inflation (with caps and floors).
“We also believe its portfolio is well-positioned to benefit from grocers generating stronger revenue growth in omni-channel stores.”
The supermarket-focused property group recently increased the size of an equity raise to £300mln and the higher number of shares in issue has prompted the broker to reduce its earnings and gearing forecasts for 2023/24.
But the additional acquisitions Supermarket Income will be able to make with the greater funds at its disposal means no change in the longer-term targets.
Dividend forecasts for this year are also unchanged implying a 4.9% yield for the year to end June 2023.