Morningstar

Lifestyle Communities Ltd LIC

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Stock XASX Rating as of
A$8.71 +0.16 (1.87%)
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As of Delayed Price Closed

Company Report

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Lifestyle: Initiating With an AUD 8.60 Fair Value Estimate and a No-Moat Rating

Esther Holloway

We initiate coverage on Lifestyle Communities with a fair value estimate of AUD 8.60 per share and a no-moat rating. We forecast revenue to grow at a 10-year compound annual growth rate of 12% and adjusted EBIT margins to approximately double to 22% by fiscal 2034 compared with fiscal 2024 as the earnings mix shifts toward higher-margin rent. We use a weighted cost of capital of 6.4%, reflecting a low cost of equity for the stable earnings in the rental and deferred management fee businesses, which make up the majority of our fair value estimate. We assign an Uncertainty Rating of Medium and a Capital Allocation Rating of Standard. Lifestyle screens as fairly valued.

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Price vs Fair Value

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LIC is trading at a 817% premium.
Price
A$8.68
Fair Value
A$4.30
Uncertainty
Medium
1-Star Price
A$79.42
5-Star Price
A$5.86
Economic Moat
Kkg
Capital Allocation
Xdcpbgwz

Bulls Say, Bears Say

Bulls

The aging population and increasing cost of living provide high demand for affordable retirement housing.

Bears

Competition in the land lease space means the firm must pay up for high value land.

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Trading Information

Previous Close Price
A$8.55
Day Range
A$8.34–8.83
52-Week Range
A$7.21–19.06
Bid/Ask
A$8.66 / A$8.91
Market Cap
A$1.06 Bil
Volume/Avg
636,115 / 727,438

Key Statistics

Price/Earnings (Normalized)
64.29
Price/Sales
3.96
Dividend Yield (Trailing)
1.21%
Dividend Yield (Forward)
1.15%
Total Yield
1.21%

Company Profile

Lifestyle Communities Ltd is an Australia-based company engaged in developing and managing communities. The firm offers independent living residential land lease communities for senior citizens; as well as home designs, resort lifestyle homes with various sports and entertainment facilities. The Company has three main revenue streams including Home Settlement Revenue, Rental Revenue, Deferred Management Fee revenue, and two ancillary revenue streams, Utilities revenue and Interest revenue.
Sector
Real Estate
Industry
Real Estate - Diversified
Stock Style Box
Small Growth
Total Number of Employees
44
Website
https://www.lifestylecommunities.com.au

Competitors

Valuation

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Metric
LIC
INA
SGP
Price/Earnings (Normalized)
 64.2923.8522.18
Price/Book Value
 1.271.361.26
Price/Sales
 3.964.434.21
Price/Cash Flow
 —24.89110.39
Price/Earnings
LIC
INA
SGP

Financial Strength

Metric
LIC
INA
SGP
Quick Ratio
 0.030.310.67
Current Ratio
 0.931.191.70
Interest Coverage
 11.434.261.42
Quick Ratio
LIC
INA
SGP

Profitability

Metric
LIC
INA
SGP
Return on Assets (Normalized)
 1.09%3.90%2.12%
Return on Equity (Normalized)
 2.37%5.98%3.61%
Return on Invested Capital (Normalized)
 −0.08%3.93%1.63%
Return on Assets
LIC
INA
SGP

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