Shares of Westfield Corp Ltd (ASX: WFD) have been falling at a steady pace in recent months and are arguably now one of the best buys on the ASX. Here are 10 things every investor needs to know about Westfield Corp.
Note: All figures are in US dollars, unless otherwise stated.
- Operations. Westfield Corp was created as part of the global restructure of the Westfield brand in 2014. Westfield Corp is now home to the brand's U.S. and U.K. stores while Scentre Group Ltd (ASX: SCG) is the owner and operator of the brand's Australian and New Zealand centres.
- Assets. The company has $28.5 billion worth of assets under management. 71% of the company's assets are located in the United States, while 29% are located in the United Kingdom.
- Expansion. Westfield is also expanding into Milan while it has the opportunity to continue spreading through Europe and South America in the future.
- Segments. Westfield has divided its portfolio into 'Flagship' and 'Regional' assets. Its primary focus is on the development of the centres that fall into its 'Flagship' category, which make up 77% of the total portfolio, as these are the ones expected to generate the strongest returns. In saying that, it only has 16 flagship centres (worth $21.9 billion), compared to 24 regional and non-core centres (worth $6.6 billion in total).
- Sales. The importance of Westfield's 'Flagship' centres is highlighted by the fact that they enjoyed annual specialty sales of $855 per square foot, compared to a portfolio average of just $700 per square foot. In total, the company recently reported $17 billion in annual retail sales from 435 million customer visits.
- Another restructure? Some analysts expect Westfield Corp to undertake another major restructure in the coming years, which could see it sell or spin-off its 'Regional' malls, thus allowing it to focus solely on the development of those it considers to be 'Flagship'. Meanwhile, there has also been talk that Westfield Corp could look to completely relocate overseas (thus, delisting from the ASX), which would make sense given its geographic reach.
- Major Developments. Westfield Corp has an $11.4 billion development pipeline. $2.4 billion worth of projects are currently underway with an estimated yield of 6.5% to 7.5% while it has $9 billion of future developments planned, with an estimated yield range of 7% to 8%.
- World Trade Centre. One of its current projects is the Westfield World Trade Centre mall, located at Ground Zero in New York. It is 99% leased and is expected to be one of the company's most rewarding assets (it will be home to some of the world's leading brands including Tiffany & Co, Apple, Victoria's Secret and Tom Ford).
- Dividends. The company distributed US 12.3 cents per security for the six months to 31 December 2014, and expects to distribute US 25.1 cents per security this year. At today's exchange rate, that equates to AU 32 cents per share, putting it on a current yield of 3.4% which will continue to expand when the Australian dollar drops.
- Australian dollar. Given that it generates all of its earnings overseas, Westfield Corp is a great way for investors to 'play' the weaker Australian dollar.
Westfield Corp is one of Australia's largest and strongest businesses and investors could certainly look to the stock's recent weakness as an opportunity to buy in at a discount. Before you buy shares in Westfield Corp however, you should know that there is one more stock which could be an even greater buy today…
