Net property income (NPI) for the final quarter slipped by 1.6% y-o-y to $152.8 million due to lower contributions from China, the absence of income from MLT's divested properties and weaker foreign exchange (forex). The lower NPI was partly mitigated by higher contributions from Singapore, Australia and Hong Kong.
That said, all the analysts here are remaining positive on the REIT.
CGS International's (CGSI) Lock Mun Yee and Li Jialin have maintained their "add" call as their estimate DPU yield of 6.4% for FY2026 has largely factored in the REIT's slower growth outlook. MLT's DPU for the 4QFY2025 and FY2025 stood in line with their forecasts at 24.4% and 100% respectively.
However, the analysts have lowered their target price to $1.63 from $1.73 as they expect to see slower growth from the REIT moving forward.
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The analysts have also lowered their DPU estimates for FY2026 and FY2027 by 1.09% and 1.98% respectively as they see that the negative reversions could weigh on MLT's overall portfolio rental reversion next year. Rental reversion in China remained negative in the 4QFY2025 at -9.4% and the analysts believe that it could impact MLT's results in FY2026 given that 50% of the REIT's lease expiries next year are from China.
DBS Group Research's Derek Tan and Dale Lai have also maintained their "buy" call as they like MLT's defensive sector exposure. They note that the REIT is one of Asia's leading logistics-focused REIT with a "unique regional platform and rising Asean exposure".
"At [its] current price, MLT trades at a P/B of 0.9 times and offers an attractive yield of [over] 6.0%," they write. "If interest rates ease, we expect stronger allocations into Singapore REITs (S-REITs), especially those with defensive sector exposure. MLT is well positioned to weather through economic downshifts, and deliver attractive total returns at the current level."
Like their peers at CGSI, Tan and Lai have lowered their target price to $1.55 from $1.75 to reflect the REIT's core earnings, excluding divestment gains and with slight adjustments to their currency assumptions.
The analysts have also lowered their FY2026/FY2027 DPU estimates to reflect the same.
"Amid market uncertainty, the manager has taken a conservative stance to preserve capital by retaining part of the past undistributed gains (estimated at $19 million), a strategy consistent in recent years," note Tan and Lai. "This approach will result in lower DPU but ensures a steadier, cashflow-backed base."
The analysts' new DPU estimates for FY2026 and FY2027 are lowered to 7.1 cents and 7.2 cents respectively, down 13% to 16%.
Morningstar's Xavier Lee has kept his "four star" rating on MLT but again with a lowered target price of $1.40 from $1.54 previously.
While MLT's 4QFY2025 results stood below Lee's expectations, the analyst recognises that the REIT is currently "undervalued" after its unit price fell by some 12% over the past month.
"[MLT] trades at an attractive 6.2% distribution yield and offers a good entry price for investors willing to look past the current cycle," Lee writes.
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The REIT should also be insulated from global trade tensions given that 85% of MLT's revenue comes from tenants serving domestic consumption and should be insulated from global trade tensions, he notes. The REIT manager also expects to maintain the same level of occupancy from its China portfolio in the coming quarter although negative rental reversions are expected to remain at a high-single-digit level, he adds.
However, with management's plans to retain its divestment gains to build up financial flexibility, Lee has lowered his FY2026 to FY2028 DPU estimates by 11.2% to 11.5%. His new estimates reflect higher borrowing costs and the removal of divestment gains.
Finally, Citi Research's Brandon Lee has kept his "buy" call and target price of $1.56, as he expects a "muted share price impact" on MLT's in-line results.
Calling MLT's 4QFY2025 results "decent" due to its improved rent reversions q-o-q and stable occupancies, Lee notes that MLT's results could be "significantly clouded by an uncertain outlook on global trade, with MLT striking a cautious outlook on China (negative rent reversions to continue) and overall demand for warehouse space, while divestment gains could be retained to build up financial flexibility".
Like his peers, Lee sees MLT's current valuations as "undemanding" at a P/B of 0.9 times and an FY2026 estimated yield of 6.8%.
Yet, he believes the REIT has limited near-term catalysts due to the uncertainty over global trade, but with 85% of its tenants servicing domestic consumption as a key mitigating factor.
As at 3.02pm, units in MLT are trading 3 cents lower or 2.59% down at $1.13.
