Hammerson Shares Are Down 2.14% YTD. Will They Keep Falling?

The Hammerson plc (LON: HMSO) share price has fallen 2.14% since the year started but had rallied higher from early January to the end of February, where it fell to new lows in late March, then rallied higher to its current price. HMSO shares are now at a 1-month low.

The real estate investment firm’s share price has lost 90% of its value in the past five years as the retail industry faced massive headwinds from e-commerce. The high-street retail industry has been in secular decline for the past few years as consumers shift to online shopping.

WELCOME BONUS - Free Share Bundle When You Invest £50! Get up to £500 cashback for investing with IG.

Invest in 15,000+ shares and ETFs. Open an account now, invest at least £50, and you’ll get a free share bundle worth between £40 and £200. T&Cs apply.

5.0

Open Account Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

Hammerson has a massive portfolio of retail real estate and was struck by the coronavirus pandemic, which forced many retailers to close for many months and forced many consumers who previously used to shop at retail stores to embrace e-commerce. 

The loosening of COVID-19 restrictions brought many clients back to high-street retail stores, but the sector has never fully recovered from the decline witnessed during the lockdowns. Furthermore, the retail sector has been hard hit by record-high inflation in the UK.

The high inflation figures have reduced consumers’ disposable income and discretionary expenditure, negatively affecting the retail industry. Still, the same issue has affected the e-commerce segment as online retailers struggle to attract clients and more sales. 

Earlier this year, Hammerson shares saw a series of downgrades from market analysts and lower share price targets. Still, the situation has started changing as analysts turn optimistic about the company’s future. 

Analysts at Barclays’ recently raised their Hammerson price target to 30p, which is quite near the current HMSO share price of about 24p. Still, the upgrade is a robust sign of the shifting market sentiment towards Hammerson. 

Many analysts now expect the retail real estate giant to generate significant cash flows as early as later this year. The analysts also expect the company to generate a decent pretax profit in 2024. The expectations are based on future predictions about the UK economy. 

Most analysts expect UK inflation to peak later this year and the retail industry to recover. 

*This is not investment advice. 

Hammerson share price. 

The Hammerson share price is down 2.14% for the year, having retraced most of its earlier gains.