Shopping centre giant Westfield Group (ASX: WDC) has come out firing today with its shares up 14.5c or 1.4% at $10.76. Although its price is still well off its 52-week high of $12.55 a share, there are a number of reasons why its shares could continue to surge in the near future. Here are three such reasons:
Revised deal. The company has revised the terms to its merger proposal with Westfield Retail Trust (ASX: WRT). Although the new terms are actually more in the Trust’s favour than in Westfield Group’s, the deal is now much more likely to receive the required shareholder approval.
They’re Cheap! Unlike other blue-chip companies like Telstra Corporation Ltd (ASX: TLS) or Commonwealth Bank of Australia (ASX: CBA), Westfield Group has significantly lagged behind the S&P/ASX 200 Index (Index: ^AXJO) (ASX: XJO) in recent years. This makes it quite an appealing investment prospect – particularly with its generous 4.9% dividend yield.
International Exposure. Overnight, Janet Yellen, the US Federal Reserve’s chair, tipped US economic growth to continue to accelerate which is an encouraging sign for investors. Westfield Group has excellent exposure to the recovering economies of the US and the UK – particularly with its redevelopments of the World Trade Centre mall in New York, as well as Westfield London and Croydon (in London’s south).
An even better investment than Westfield Group
Westfield Group is certainly an attractive investment prospect and one that I have considered around these prices. However, I believe there are even better opportunities to take advantage of.