Correction happened today as I expected yesterday: change of CEO was already taken into share price. I would expect that this trend will continue during next few days (not every day probably, but in general) until some good news will come.
In mid-term positive factors can be:
- start of massive vaccination (partially taken into price)
- France and other European reopening (under risk, so not fully in price)
- European Central Bank cheap loans or any other program for Covid-suffered companies (just Euribor-rate?) (not taken into price)
- Low interest bonds issued (low impact, as doesn't improve LTV much)
- Subordinated bonds issue. Not sure, but it seems that it improves LTV. The problem here is that they are usually issued with high interest rate (not very big, but successful bank in my country issued them with 6%, but I believe it should be much cheaper for URW).
Mid-term possible risks:
- Europe will not re-open in the end of November or this year at all
- USA is closing malls
Long-term possible positive trends:
- Number of infections decrease as a result of vaccination or/and herd immunity, malls reopening
Long-term risks:
- Share issue decision: it is a bit strange, but for companies like SPG it means share price rise, when for URW it will mean invested value decrease
- Short time immunity for Covid, nothing is being re-opened for one, two or more years. That basically means that year footfall is limited by 50% of pre-covid levels (opened only summer period?), so that malls valuation can be divided by 2 at least.
Generally, I stay in URW for long, as the only negative scenario for long term investments is last described. In this case almost all invested amount will be lost. But personally I don't believe in this.
All other negative factors will last temporary and limited till number of infections will be decreased. Worst case scenario is that more or less everything is fully opened starting from April-May 2021. 2020 Q4 and 2021 Q1 I expect to be the same bad as 2020 Q2, I wonder if URW will manage to survive in this case without share issue. I think it is worth of sitting down and calculating.
Will not start describing more positive scenarios as this text is becoming too long.