Berenberg upgrades Empiric Student Property to 'buy'

Berenberg said although Empiric's full-year 2021 results were "heavily affected| by the Covid-19 pandemic, with strong application data and continued demand for higher education, it now expects to see a return to normal operations in autumn 2022.

Ahead of this normalisation, Berenberg noted that Empiric management had continued to lay the groundwork for success, with portfolio optimisation continuing as the firm's refurbishment, recycling activity and small-scale development continued, while all of its operations were internalised - mitigating cost and increasing agility.

"We continue to think that the wholesale return of international students, which are Empiric's primary pre-pandemic occupier, this autumn is likely to result in an uptick in both occupancy and organic growth rates, resulting in a forecast EPS CAGR of 36.6% to FY 2024E," said the German bank.

"With a step-change in performance forecast and the shares trading at a 15% discount to our unchanged 100.0p price target, we upgrade our rating to a 'buy' from 'hold'."