Why Goodman Group is crushing the market

Credit: Mark, Vicki, Ellaura and Mason

Goodman Group (ASX: GMG) yesterday announced its half year results, delivering an operating profit of $357 million and statutory profit under IFRS of $919 million. The group continues to capitalise on the strong global demand for modern, high quality logistics space in prime gateway cities, ensuring it’s well positioned to drive consistent earnings growth over the remainder of FY16.

Goodman is an integrated property group with operations throughout Australia, New Zealand, Asia, Europe, the United Kingdom, North America and Brazil. Other highlights included operating earnings per security (EPS) of 20.1 cents, up 7.5% on the pcp, and total distribution of 11.9 cents per stapled security, up 7% on the pcp.

The company has $33 billion in total assets under management with occupancy maintained at 96%, and weighted average lease expiry of 4.7 years.

Goodman’s Group Chief Executive Officer, Mr Greg Goodman said, “Goodman has performed strongly in the first half, delivering an operating profit of $357 million. This represents a 9% increase on the same period last year and equates to growth in operating earnings per security of 7.5%. The outperformance achieved was largely driven by the quality and strength of our growing $3.4 billion development work book and active nature of our investment Partnerships.”

Goodman is well positioned for the second half of FY16 and expects first half operating profit to be maintained. Accordingly, the group has upwardly revised its forecast full year FY16 operating earnings per security to 40 cents, up 7.5% on FY15, with forecast distributions increased to 24 cents, up 8% on FY15.

Goodman has been outstanding in the last three months, outperforming the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) by 11%, in a sector that’s been dominated by Scentre  Group (ASX: SCG), Vicinity Centres Re Ltd (ASX: VCX), and GPT Group (ASX: GPT) who have all outperformed the same index  by 16%, 12%, and 12% respectively.

While Goodman Group has had an outstanding six months, there are 3 other blue chip shares set to soar in 2016:

Discover The Motley Fool's top 3 blue chips for 2016. These 3 'new breed' shares pay fully franked dividends AND offer the very real prospect of significant capital appreciation. Simply click here to gain access to this comprehensive FREE investment report.

No credit card required.

Motley Fool contributor John Hopkins has no position in any stocks mentioned. Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.