Tuesday, June 16, 2009
S Reit - Worth a look
Below base on closing price on Jun 12, 2009:
Starhill Gbl （P4OU）
DY：10.1%，Closing price：S$0.71，NTA: S$1.43。
DY：11.1%，PE：3.8，Closing price：S$0.91，NTA: S$2.94。
DY：10.0%，PE：4.3，Closing price：S$1.43，NTA: S$2.44。
DY：12.9%，PE：--，Closing price：S$0.975，NTA: S$2.001。
DY：40.5%，PE：--，Closeing price：S$0.135，NTA: S$0.85。
DY：16.7%，PE：8.6，Closing price：S$0.36，NTA: S$0.73。
CDL HTrust 城市酒店信托(J85)
DY：13.9%，PE：--，Closing price：S$0.765，NTA: S$1.39。
DY：12.3%，PE：7.1，Closing price：S$0.59，NTA: S$0.90。
DY：15.8%，PE：--，Closing price：S$0.355，NTA : S$0.727。
DY：25.9%，PE：--，Closing price：S$0.345，NTA : S$1.09。
DY：12.8%，PE：--，Closing price：S$0.69，NTA: S$1.51。
DY：13%，PE：23.8，Closing price：S$1.00，NTA: S$2.22。
First REIT 先锋医疗产业信托(AW9U)
DY：12.2%，PE：7.4，Closing price：S$0.625，NTA: S$0.93。
Currently, most of the Singapore REIT are trading around DY of 11% or more. Some of the counters are traded below 50% of the NTA. This is a good investment opportunity, just consider one can receive 11% dividend with potential capital return in next 5 years.
The reason why REITs trade at the discount of NTA was due to glommy economy especially those properties located in US and Europe. Due to the aggressive buying of new asset in past two years, some company actually borrow too much. Some of companies actually not able to pay the dividend as they need to generate or retain more cash. Couples of companies are considering right issue to pay for the debt or raise the capital to meet the comfortable level.
When more shares issues and circulate in the market, it will further damper the market price. Hence, one need to consider carefully before invest in REITs, not only the return on dividend rate and NTA alone. REITs is different from typical stock, it's depend on the rental to generate the cash flow and income, hence as long as they have the well diversified portfolio, be it in industrial or office building, we should have a very good return of more than 10%. The current under appreciated price provide an opportunities for one to enter this field with low cost.
Related link: Housing Investment