Analysts are mixed on the prospects of Frasers Hospitality Trust (FHT), which has hospitality assets across nine cities in Asia, Australia and Europe.
This comes after FHT posted a weak set of 4QFY2020 results ended Sept 30.
On one hand, UOB KayHian has maintained its “buy” rating for the trust with a higher target price of 55 cents from 54 cents previously.
On the other hand, Maybank Kim Eng has retained its “hold” call for the trust with a lower target price of 40 cents from 45 cents previously.
According to UOBKH, FHT should benefit from a potential recovery in domestic travel in Australia.
It notes that Melbourne has reopened in late October after a hard lockdown lasting more than three months.
The brokerage has forecast the trust to record distribution yields of 4.3% in FY21 and 8.8% in FY2022.
“[We are] cautiously optimistic on FHT’s outlook,” UOBKH analysts Nicola Ho and Jonathan Koh write in a note dated Nov 3.
However, Maybank KE points out that FHT’s demand visibility is low.
It notes that the trust’s occupancy levels were lower than its peers at 32% to 53%.
As such, the brokerage has cut its forecasts for FHT by 12% to 15%.
As at 10.19 am, FHT was up 3 cents or 7.1% at 45 cents with 2.4 million units changed hands.