Why is the Summerset share price on watch?
Summerset this morning provided a sales update for the quarter ended 31 March 2021 (Q1 2021). The company reported 275 sales for the quarter including 148 new sales and 127 resales.
Summerset’s business model relies on selling occupation rights for its retirement and care villages. These rights are sold to temporary residents, with either new village sales or the resale to a new tenant.
The Summerset share price is on watch after CEO Scott Scoullar said the waitlist is up 24% from one year ago. That figure is also up 8% on the previous quarter as demand continues to grow despite the coronavirus pandemic.
Mr Scoullar also said there is a good pipeline of new builds to come. This includes a $170 million village in Prebbleton, New Zealand, which was granted resource consent in March. The new facility would comprise more than 290 independent homes and include a state-of-the-art memory care centre for residents with dementia.
The leading retirement village operator and developer has 33 villages completed or in development across New Zealand. Summerset also has three properties in Victoria, Australia among others that brings its total sites to 43.
The Summerset share price is on watch today following the company’s latest update. Shares in the retirement village operator managed to soar in 2021 as New Zealand effectively contained COVID-19.
In fact, the Summerset share price has rocketed 85.6% higher in the last twelve months after plummeting to a 52-week low of $5.33 in the March 2020 bear market. Summerset currently boasts a market capitalisation of $2.5 billion on the ASX.
The S&P/ASX 200 Index (ASX: XJO) is tipped to rise this morning with the latest SPI futures pointing to a 0.1% gain at the open
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Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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