Cedar Woods Properties Limited

Section 1: Company Overview and Fundamentals

1.1 Company Overview:

Cedar Woods Properties Limited (ASX: CWP) is a property developer and investor. The company’s products include land, apartments, townhouses and commercial.

1.2 The Key Positives, Negatives, Investment Highlights and Risks

1.3 Top 10 Shareholders: The top 10 shareholders together form ~43.20% of the total shareholding. Hames (William George) and AustralianSuper hold a maximum stake in the company at ~13.23% and ~11.31%, respectively.

1.4 Key Metrics:

During 1HFY22, the company recorded an asset to equity ratio of 1.77x against the industry median of 5.36x. In addition, the asset turnover ratio stood at 0.25x as compared to 0.09x of the industry median. Below captured the trend of cash cycle days and asset turnover ratio. 

Section 2: Financial and Operational Highlights

2.1: 3QFY22 Summary:

2.2: Insights of 1HFY22:

2.3 Segmental Highlights:

The company possesses a pipeline of over 10,000 undeveloped lots/dwellings across four states (WA, VIC, QLD, and SA). In addition, low-interest rates, low unemployment, and favourable economic conditions are fueling increased sales conditions.

Section 3: Key Risks and Outlook:

Section 4: Stock Recommendation Summary:

4.1 Price Performance and Technical Summary:

4.2 Fundamental Valuation

Valuation Methodology: P/E Multiple Based Relative Valuation (Illustrative)

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is August 1, 2022. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

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