KPG - Kiwi Property Group

winner (n) · Feb 23, 2026, 04:13 PM

Quote from: Basil on Feb 23, 2026, 03:16 PMIt seems all the REITS in N.Z. peaked in October 25. Drops from the peak are SPG 20%, PCT 18%, GMT 17%, VHP 17%, PFI 16%, ARG 15% KPG 15%.

The extent of these falls seems like a lot to me. Going off the new Reserve Bank Governors tone last week, I think interest rates could stay lower for longer.

Could be that the price of REITs got over inflated .... exuberance led to a fair degree of overpricing and that they have fallen back to more realistic/normal levels

Might bore you but on my KPG/10 Year Govt Stock correlation 'fair value' now is 97/98 cents

Basil · Feb 23, 2026, 04:48 PM

Yields are in some cases 6% net now, worth 9% gross to 33% taxpayers and ~10% to 39% taxpayers.

winner (n) · Feb 23, 2026, 05:51 PM

Quote from: winner (n) on Feb 23, 2026, 04:13 PMCould be that the price of REITs got over inflated .... exuberance led to a fair degree of overpricing and that they have fallen back to more realistic/normal levels

Might bore you but on my KPG/10 Year Govt Stock correlation 'fair value' now is 97/98 cents

Scary stuff possums ...KPG close today 97 cents

Dolcile · Feb 24, 2026, 09:05 AM

A first glance it looks like a good result announced by PFI this morning. Guiding to a FY26 dividend increase.

entrep · Mar 11, 2026, 12:07 PM

Why so weak? We are ex-div, but it was only a few cents!

Basil · Mar 11, 2026, 02:52 PM

Don't know. Divvy was only 1 4 cps.

LaserEyeKiwi · Mar 11, 2026, 03:05 PM

Was trading at a 20% discount to NTA there this morning, which is a bit of a strange one.

Shareguy · Mar 11, 2026, 03:24 PM

Is it not a storey of perceived interest rate rises. All the Reits are struggling.

winner (n) · Mar 11, 2026, 03:37 PM

Quote from: Shareguy on Mar 11, 2026, 03:24 PMIs it not a storey of perceived interest rate rises. All the Reits are struggling.

'Fair value' now based on long term correlation with 10 Year Govt Stock is 94/96

Spooky eh possums

Basil · Mar 11, 2026, 04:42 PM

Quote from: Shareguy on Mar 11, 2026, 03:24 PMIs it not a storey of perceived interest rate rises. All the Reits are struggling.

Quite correct mate. I just reviewed this again. They all peaked in October 2025. Since then declines from the peak are as follows:-
PCT 18.1%
GMT 15.3%
VHP 19%
PFI 11.7%
ARG 15.7%
KPG 16.7%
SPG 23%
ITs been painful and I think its overdone but the market thinks otherwise so what can you do...

Dolcile · Mar 11, 2026, 08:13 PM

It is kind of strange how hard they REITs are getting hammered. I'm sure fixed interest / bond funds aren't down that much of the same period.

Dolcile · Mar 11, 2026, 08:16 PM

I just had a look, the Simplicity NZ Bond Fund is down 1.36% since the end of October 2025. That's total return, i.e. interest reinvested.

Plata · Mar 11, 2026, 08:59 PM

I'm waiting for the next oil spike to drive this down into the 80s and I'll back up the truck, same with GNE.

Apollo · Mar 12, 2026, 08:13 AM

Quote from: Basil on Mar 11, 2026, 04:42 PMQuite correct mate. I just reviewed this again. They all peaked in October 2025. Since then declines from the peak are as follows:-
PCT 18.1%
GMT 15.3%
VHP 19%
PFI 11.7%
ARG 15.7%
KPG 16.7%
SPG 23%
ITs been painful and I think its overdone but the market thinks otherwise so what can you do...

Makes my 3% short term term deposits look good since October. You have to deduct the dividends paid off this decline as well which makes it less painful.

I guess we need to know where interest rates are heading to know what is the best option from here. Are we coming to the end of a long term interest rate cycle as Ray Dalio has suggested we might, in which case the property companies will under perform. Will we get money printing and interest rate suppression in which case they will thrive.

I recall Basil some time ago you looked at KPG and concluded that mgmt had been unable to grow earnings over a long period of time. Other than the yield do you see these companies growing their earnings. Higher interest rates not only mean moving capital valuation rates but higher interest costs as well.

Not wanting to be a doomsayer as I like the steady income provided by the property companies but do they have a bit further to fall as we adjust to a higher interest rate world?

Basil · Mar 12, 2026, 09:03 AM

Consensus for KPG is for steady earnings growth of about 3% per year for the next few years enabling DPS to rise gradually from 5.6 CPS to just over 6 CPS.

As I see it, the market hates uncertainty and maybe we're at peak uncertainty at the moment ?

Nobody knows how long the war will persist and oil prices stay elevated to where they very recently were.

Its well worth noting that fuel prices now are still lower than where they were three to four years ago and significantly lower in real inflation adjusted terms .

There's always sunshine after rain. Stay calm and carry on...