RURAL FUNDS GROUP (RFF)
Share Price Analysis and Chart

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20/06/2025

3

Neutral

$1.89

-3.08%

UBS believes the backdrop is positive for the REIT sector from a likely trough in asset valuations, falling interest rates and robust rental growth. However, headwinds remain from both residential and commercial construction, making completed assets/core real estate more valuable.

The broker is forecasting a terminal RBA policy rate of 3.6% (from 4.0% before) but notes market pricing is for a 3.1% rate by December. If that materialises, its FY26 EPS forecasts for stocks would rise by 2%.

Forecasts revised on lower terminal rate assumptions. 

Neutral retained for Rural Funds. Target rises to $1.89 from $1.84 on revised forecasts, including higher FY25 macadamia income.

FORECAST
UBS forecasts a full year FY26 dividend of 11.70 cents and EPS of 12.10 cents.

26/02/2025

1

Overweight

$2.51

28.72%

Rural Funds' adjusted funds from operations (AFFO) in 1H25 beat Wilsons' forecast by 17% on stronger farming and other net income, though the broker comments this was largely due to timing differences.

Gearing increased modestly to 38.6% from 38.6% in FY24, but the broker sees potential for a material reduction, which would be a key share price catalyst along with growth resumption.

Wilsons made minor changes to property and farming revenue, leading to minor shifts in FY25-26 AFFO forecasts. 

Target price rises to $2.51 from $2.43 on a roll forward in the base year to FY26. Overweight rating.

FORECAST
Wilsons forecasts a full year FY26 dividend of 11.70 cents and EPS of 12.10 cents.