Yes, a barrier to entry, or a way to the exit as well, for the weaker players; I tend to agree with you on that one.
What the “Goldilocks “figure is, I have no idea really, but I do observe that, within their historical range of 75%-85% average occupancy rate, GEM have consistently improved their EBITDA margin, which makes me feel positive about the future.
There is also a degree of correlation with the economic cycle, which in WA and QLD has a lot to do with commodity prices; now, that tide too seems to have turned in a positive way.
Ultimately, though, corporations do have to meet their clients’ needs; therefore, I do welcome the fact that GEM are increasing their capex with the aim of offering a better service.
GEM Price at posting:
$4.06 Sentiment: Buy Disclosure: Held
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