UBM Development cut to HOLD, TP EUR 43.0 - Forward sales provide support, but crisis affects plans
We downgrade UBM to HOLD with a new TP of EUR 43 per share (before EUR 54 per share). The company is quite well prepared to weather the crisis and forward sales of recent years will definitely smoothen the impact. Nevertheless, the uncertain market conditions will be reflected in the FY 20 and FY 21 financial results and we reckon that less forward sales than initially planned will be generated in the next 12 months. The investment case is largely dependent on the type and length of recovery. The project pipeline remains strong but some projects will likely be shifted further back and fewer projects than planned will be realised in the coming three years. The stock price has recovered quite significantly from the lows of EURUBM Realitaetsentwicklung is engaged in the the development, utilization and management of real estate. Co.'s projects include: hotels; trade/entertainment; office blocks; logistics/commerce; urban development; residential buildings; revitalization; special projects; and garages/parking.
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