Our opinion on the current state of SHBCAP(SHC)

Shaftesbury Capital is a real estate investment trust (REIT) which invests in properties in London's West End, including Covent Garden, Carnaby, Chinatown, and Fitzrovia. It has a property portfolio worth GBP4.9bn and 2.9m square feet of lettable space in 2000 buildings. The share is listed on the London Stock Exchange (LSE) and on the JSE. The share is obviously a rand hedge, but it has been on a protracted downward trend.

In its results for the year to 31st December 2023, the company reported a vacancy rate of 2.1% and annualised gross income up 10.4%. The value of the whole portfolio dropped 0.8% to GBP4.8bn. The company said, "Rental growth, cash conversion, and cost control resulting in strong earnings performance. Proposed final dividend of 1.65 pence per share and a full-year dividend of 3.15 pence per share (H1: 1.5 pence; H2: 1.65 pence). Excellent progress on integration; renewed purpose and values which form the basis of how we operate."

In an update ahead of the AGM, the company reported a vacancy rate of 2.5% and rents up 7% from December 2023. The company said, "23 new brands introduced including PANGAIA, Alo, ELEMIS, ERGON House and The Little Violet Door - £212.6 million of asset disposals completed since merger; £82.9 million reinvested in target acquisitions."

Technically, the share has been in a downward trend since the beginning of 2016. We recommended waiting for it to break convincingly up through its long-term downward trendline, which happened on 3rd February 2023 at a share price of 2578c. It has subsequently moved up to 3264c.