OUR QUEST IS NOT TO BE BULLISH OR BEARISH, BUT TO CORRECTLY ASSESS FUTURE TRENDS

Citi rates GOZ as Buy

Citi believes Growthpoint Properties Australia continues to remain a relative "value" stock and the upcoming Woolworths Group's ((WOW)) distribution centre sale will facilitate a reduction in gearing by around -4%.

The stock is trading at circa -30% discount to NTA of $3.10 and an 8.8% yield. Buy. Target $2.60.

First take:

On first glance, Citi reports Growthpoint Properties Australia delivered FY26 funds from operations ahead of consensus, supported by record office leasing that lifted occupancy to 96% – the best in years.

FY27 FFO guidance is a step down from FY26 but broadly in line with Citi's estimate, suggesting the top end remains achievable. The pending Woolworths distribution centre divestment will reduce gearing by -4%, providing welcome balance sheet relief at 41.6% gearing.

Trading at a -30% discount to reported net tangible asset valuation and offering a forward yield of 8.8%, Growthpoint remains a relative value stock, Citi suggests. Buy and $2.60 target retained.

Macquarie rates GWA as Neutral

Macquarie assesses GWA Group's FY26 result as "solid", with revenue in line and earnings (EBIT) slightly ahead of expectations despite a softer second half.

Australian growth was supported by Merchant, Multi-Residential and Win the Plumber performing well, while detached housing, renovations and commercial markets remained subdued, the analyst explains.

Win the Plumber is a strategic initiative aimed at increasing preference and loyalty amongst plumbers for its brands and products.

The broker expects a mixed FY27 outlook, with higher pricing helping offset cost pressures and cash conversion recovering as inventory unwinds.

Macquarie lowers FY27-FY29 EPS forecasts by -1.4%-3.8%, reflecting higher costs and pricing decisions, partly offset by stronger near-term volumes. The target is raised to $2.30 from $2.15. Neutral rating maintained.