SCG share price in focus
Scentre Group is a real estate company specializing in shopping centres, operating under the Westfield brand in Australia and New Zealand.
The group manages a portfolio of 42 centres valued at over $34 billion, boasting an occupancy rate exceeding 99% and attracting more than half a billion visitors annually.
These centres are strategically located in prime trade areas and feature long-term tenancies with retailers catering to diverse consumer interests in fashion, dining, leisure, and entertainment.
COL shares
Coles is a leading Australian retailer providing everyday essentials including fresh food, groceries, general merchandise, liquor, fuel and financial services. It was founded in 1914 in Victoria and still calls Melbourne its home base.
Coles was formerly owned by the listed giant Wesfarmers from 2007 until 2018, when it was spun-off and listed as its own entity on the ASX under the ticker symbol ‘COL’. Coles’ earnings are unsurprisingly dominated by the supermarket side of the business, however, it partly or fully owns and operates adjacent businesses like flybuys, Liquorland, First Choice, Vintage Cellars, Coles Express and more.
While Coles is second to Woolworths in the supermarket sector, it still controls a significant share of the Australian grocery market (about 28%). Since its listing in 2018, Coles has established itself as a fairly reliable dividend payer for investors seeking income.
SCG & COL share price valuation
We would consider SCG to be a ‘mature’ or ‘blue-chip’ business, so some of the metrics that could be worth considering include the debt/equity ratio, average yield, and return on equity, or ROE. These measures give us a sense of the company’s debt levels, their ability to generate returns from their assets, and their ability to consistently return profits to shareholders.
For CY23, Scentre Group reported a debt/equity ratio of 87.3%, meaning the company has more equity than debt.
Over the last 5 years, SCG has delivered an average dividend yield of 4.8% per year. This is important to note if you’re looking for income from your investments.
Finally, in CY23, SCG reported an ROE of 1.0%. For a mature business you generally want to see an ROE of more than 10%, so SCG’s returns are a bit less than what we’d expect.
As for Coles Group Ltd, they reported a debt/equity ratio of 278.4% in FY24, meaning the company is leveraged.
Since 2019 COL has achieved an average dividend yield of 3.8% per year, and in FY24 reported an ROE of 32.4%
Keep in mind that these are only a small selection of metrics. We don’t have enough information to value the business or make an investment decision. To learn more about valuation, check out one of our free online investing courses.
