KLPEF - Klepierre: Time To Take Some Profits As Price Approaches NAV (Rating Downgrade)

2024-05-08 14:20:46 ET

Summary

• Klepierre confirmed its net current cash flow per share guidance of €2.45-2.50/share in 2024, flat Y/Y.
• The company has started refinancing debt at about 3.85% for 9.6 maturities, slowly eroding its 1.5% average cost of debt (YE 2023).
• The market cap rate of about 6.07% is in line with the year-end 2021 value and factors in little financial stress.
• Its fortress balance sheet already allows Klepierre to conduct value creative M&A.
• Selling covered calls is an excellent way to position going forward, with key risks being surprises in Eurozone inflation and small emerging market exposure.

Introduction

I previously covered Klepierre ( KLPEF ) back in February this year, highlighting the company's strong interest rate hedging profile. So far in 2024, Klepierre has largely performed in line with the Vanguard Global ex-U.S. Real Estate Index Fund ETF ( VNQI ), delivering flat returns, but notably recovering from a small sell-off around the time of my previous article:

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