Analysts at investment bank Macquarie have upgraded the firm's outlook for several ASX real estate investment trusts (REITs) this week.
It's been a mixed period these past few weeks for the sector, with the S&P/ASX 200 A-REIT Index (ASX: XPJ) down more than 8% in the past month, when the broader market is down nearly 7%.
Let's take a deeper dive.
Image source: Getty Images
ASX REITs catch the bid
The sell-off in ASX REITs has seen Macquarie lift its ratings on four names in the sector this week.
As The Australian reports today, the broker has slapped buy ratings on Centuria Capital Group (ASX: CNI), Goodman Group (ASX: GMG), and Arena REIT (ASX: ARF).
Meanwhile, Scentre Group (ASX: SCG) was raised to a hold rating.
Collectively, these stocks have taken a hit in recent weeks. Their performance for 2025 so far is seen in the chart below.
But the outlook for ASX REITs might be turning more positive, judging by other upgrades brokers have made in recent weeks.
As my colleague James reported, Bell Potter added the company to its Australian equities panel for March.
Bell said Goodman is "an attractive opportunity", more so after the recent weakness in its share price.
Meanwhile, Citi also rates the stock a buy at a price target of $40 apiece. Goodman was last at $30.53.
Macquarie also upgraded Centuria Capital Group, which manages two additional ASX REITs, the Centuria Industrial REIT (ASX: CIP) and the Centuria Office REIT (ASX: COF).
According to Tradingview, the consensus price target on the Group from brokers is $1.88 apiece, around 18% upside at the time of writing.
Note, this excludes any dividend forecasts.
Meanwhile, the consensus of broker estimates has a price target of $4.19 apiece on Arena REIT's share price.
The stock closed trading last week at $3.60 apiece, which implies around a 35% upside currently.
In its H1 FY25 results, the company also booked a 16% increase in operating profit and an 87% growth in net profit.
Arena is also aiming to pay a distribution of 18.25 cents per share in FY25, a 5% increase on last year.
Despite Macquarie's upgrade today, the stock is rated a hold from the consensus of analyst estimates, according to CommSec.
Foolish takeaway
Analysts at Macquarie have upgraded these ASX REITs this week after a sharp sell-off in the sector.
Does this suggest that the sector may have bottomed out? Or that Macquarie has some form of crystal ball? Not necessarily.
As a sector, Aussie REITs have held onto a 1% gain over the past year.
