Renta 4 reiterates its recommendation to 'overweight' Merlin Properties, with a target price of €17.60, representing an upside potential of 15.8%. The REIT will present its first half results this Monday, July 27.
Merlin Properties will publish its results for the first half of the year this Monday, July 27, after the market closes. The conference with analysts will be held the following day, Tuesday, at 15:00 CET. Awaiting the figures, analysts at Renta 4 have reiterated their 'overweight' recommendation on the stock, with a target price of €17.60 per share, which represents an upside potential of 15.8% compared to the current share price.
Analyst Javier Díaz from Renta 4 notes in a report that he expects positive developments in the company's operational and financial figures. Among the factors supporting this view, he highlights the growth of like-for-like rents, which stands at +3.5% in 2025 and Q1 2026, supported by the indexation of contracts. Additionally, the net leasing volume for the last fiscal year reached 112,000 square meters in 2025 and 2,500 square meters in the first quarter of 2026, with positive release spreads across all segments: +2.8% in offices, +7.4% in shopping centres, and +6.2% in logistics.
Occupancy remains stable at levels close to historical highs, with 95.0% at the end of the first quarter of 2026. Another relevant factor is the consolidation of income from the rental of the data centre in Bilbao (BIO-ARA 03) since October 2025, indicating that Phase I of this asset is fully leased.
Renta 4 estimates that Merlin Properties will record gross rents of €146.2 million, representing a 9.9% increase compared to the second quarter of 2025. The expected EBITDA is €108.2 million, compared to €102.2 million in the previous quarter, and the FFO (funds from operations) would reach €90.2 million, a 9.4% increase. For the half-year total, the estimated FFO amounts to €177.6 million, representing 54% of the annual target set by the company.
Díaz also points out that this quarter includes the review of the fair value of the assets. For traditional assets, he expects stability, as good operational performance would offset the higher discount rate expected following the 25 basis point increase in rates by the ECB in June. In contrast, he anticipates an increase in value due to the consolidation of the data centre developments. Regarding the LTV (loan-to-value) ratio, the analyst estimates it will be around 25%, considering that in the second quarter the company received €767.6 million from the first capital increase, carried out at the end of March, associated with Phase III of the data centre plan.
With these forecasts, Renta 4 does not rule out that Merlin Properties may slightly raise its FFO target for the entire year, given that it has already reached more than half of the annual goal in just six months. Investors will be attentive to the conference on Tuesday to learn about the REIT's outlook and possible updates to its guidance.
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