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S&P/ASX 200 Index (ASX: XJO) property shares are not the most exciting for investors today. When interest rates are rising, investing in real estate stocks sounds silly. right?
Let’s check the numbers.
For 2022 to date S&P/ASX 200 A-REIT Index (ASX: XPJ) is down 26%. That’s pretty close to terrible performance S&P/ASX 200 Information Technology Index (ASX: XIJ), down 33%.
However, we don’t often hear about real estate stocks technology shares. They’re just not sexy.
Real estate stocks also fell further S&P/ASX 200 Consumer Desired (ASX: XDJ) shares have dominated the headlines as pundits tout consumer confidence cratering ahead due to inflation.
Consumer discretionary stocks fell 20.8%, meaning they outperformed property stocks by 5%. Hmm.
Property options in the ASX 200
There are 76 ASX real estate stocks on the market. Most of them are real estate investment trusts (REITs) representing a wide range of areas in the real estate sector.
For example, there is The Mirvac Group (ASX: MGR), which is a major housing developer, and Central group (ASX: SCG), the largest owner of premium shopping centers in Australia and New Zealand. There are also property management companies and investment companies Charter Hall group (ASX: CHC).
Do you regret not buying this house?
If you polled 50-year-old Australians, chances are the majority of them mourn the property they didn’t buy and how much it’s worth today.
It’s a pretty common beat-it-yourself theme. They look back and wonder why they didn’t buy when prices were soft or falling.
Could a similar situation be staring us in the face with ASX 200 property shares today?
Buy this share of ASX 200 property, experts say
Experts seem to think so, and one ASX 200 stock they seem to strongly support The Goodman Group (ASX: GMG).
Nine out of 14 analysts have a strong buy rating on Goodman shares today, according to data published on Westpac’s trading platform. Four say hold and one recommends a “moderate” sell.
A 36% drop in Goodman’s share price in 2022 is believed to be a factor in their decision.
This led to a reduction price-earnings (P/E) ratio. to 9.1, which is much lower than the market and real estate sector averages of 14 or more.
As my colleague James reported yesterday, the prime broker is Goldman Sachs cattlesaying:
GMG continues to demonstrate its strong platform and positioning, which is evident in the [the FY22] a result supported by our expectations of a strong outlook for the industrials sector more broadly, with a number of favorable fundamentals underpinning future long-term demand for industrial areas.
Goldman has a buy rating and a 12-month price target for this ASX 200 property share of $25.40. By the way, this is a growth potential of 49.85% in just one year. Somehow sexy.
Who is Goodman Group?
The Goodman Group is Australia’s largest REIT. Among property shares, it is definitely a blue chip.
It is also one of the biggest stocks on the ASX 200 with a market capitalization 31.14 billion dollars.
Goodman is it an integrated global real estate group which specializes in industrial property. Warehouses, factories, distribution centers, business and office parks – everything.
It has four divisions — real estate investment, fund management, real estate services, and real estate development. It operates in 14 countries in the Asia-Pacific region, Europe, Great Britain and America.
According to founder and CEO Greg Goodman, they manage $73 billion in real estate and plan to develop $13.6 billion.
In total, the company manages 410 facilities. In 2022, operating income is reported to be $1.5 billion annual report.
Shares of Goodman closed the session on Wednesday at $16.95, up 2.36% on the day.
It has a 52-week high of $26.96 and a 52-week low of $15.57.