GMG share price in focus
Founded in 1989, Goodman Group is a global integrated property group that owns, develops and manages real estate assets across several continents.
Goodman is the largest ASX-listed property group and operates in markets including Australia, New Zealand, the UK, Japan, the US, and Brazil.
The company is primarily involved with projects such as warehouses, large scale logistics facilities and business and office parks. Its mission is to build mutually beneficial, long-term relationships with its customers and deliver high quality assets.
Since we consider Goodman Group to be a blue chip stock, or a mature business, we like to look at things like return on invested capital (ROIC) and revenue growth as signs of sustainability. In FY24, Goodman Group had an ROIC of -1.20% and revenue has compounded at -31.5% in recent years. If a mature business struggles to consistently hit 10% ROIC it could be a sign the business may not be investing its capital well. This is just a rule of thumb we follow.
TLS shares
Telstra was founded in 1975 and is Australia’s largest telecommunications company by market share providing over 22.5 million retail mobile accounts in 2023.
Telstra is responsible for building and operating telecommunication networks and has a range of businesses including fixed broadband, mobile, data and IP, and digital media. The company also has a presence in over 20 countries outside of Australia where it provides services to governments and businesses.
The advantage that Telstra has over competitors lies in its reach and scale, providing coverage to 99.6% of the Australian population and 5G services to over 85%.
GMG share price valuation
We would consider GMG to be a ‘mature’ or ‘blue-chip’ business, so some of the metrics that might be important to us include the debt/equity ratio, average yield, and return on equity, or ROE. For FY24, Goodman Group reported a debt/equity ratio of 21.2%, meaning the company has more equity than debt.
Over the last 5 years, GMG has delivered an average dividend yield of 1.3% per year. This is important to note if you’re looking for income from your investments.
Finally, in FY24, GMG reported an ROE of 0.1%. For a mature business you generally want to see an ROE of more than 10%, so GMG’s returns are a bit less than what we’d expect.
In FY24, Telstra Group Ltd reported a debt/equity ratio of 99.4%, meaning the company has more equity than debt.
As for dividends, since 2019 TLS has achieved an average dividend yield of 3.6% per year, and in FY24 reported an ROE of 10.7%
It’s important to keep in mind that these are only a selection of metrics and don’t give us enough information to value the business or make an investment decision. To learn more about valuation, I’d recommend checking out one of our free online investing courses.
