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Analysis & Comment:  

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This week we take another look at the St. Modwen’s 6.25% 2019 bond.  We first covered this bond when it came to market back in 2012 here.

Compared to four other property bonds on the market it has the highest coupon and even though it trades around the 106 level (down from the May highs of 109.5) still has an attractive yield of over 5%.  We’ve not got this bond in our portfolio as we are currently fully invested, but should the price come closer to par we may look to add.

     

Price

Yield

PHP

5.375%

2019

106.6

3.979%

CLS

5.50%

2019

103.25

4.842%

Workspace

6%

2019

105.75

4.799%

St. Modwen

6.25%

2019

105.925

5.018%

 

The stock has been in the news recently as the founding family have sold around £13m worth of shares, leaving them with a 8.43% in the company.  On a fundamental basis Liberum Capital reiterates their 432 price target and buy rating (currently 383).  The market cap is around £875m and from a technical point of view the share price is approaching resistance within a bullish trend.

In other Orb related news, Tullow Oil has priced it’s $500m issue with a 6.25% coupon, although the minimum size is $200k so will not appeal to most private investors.  Elsewhere in the oil sector the traders favourite Gulf Keystone Petrolium is looking to raise around $250m and Enquest who we wrote about previously here may come in around 6.75% to 7%.

 

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