The Monthly Nibble: 3 Most Popular Articles for November
- Original Post from The Motley Fool Sg

Here are some of the most popular articles that have appeared on The Motley Fool Singapore’s website for the month.


Why Did First Real Estate Investment Trust’s Unit Price Plunge Yesterday?


Units in First Real Estate Investment Trust (SGX: AW9U) have been ailing in the past week.


As a quick background, First REIT owns 20 properties — mostly healthcare-related —in Indonesia, Singapore and South Korea. On 19 November, the REIT’s unit price tumbled more than 7%. What could be the reason behind the sudden fall? Jeremy Chia finds out more in his article.


(Post-publication note: As an update to the market, on 21 November, the REIT’s manager announced that it is unaware of “any material information which has not previously been announced or otherwise made known in the public domain from any source that could have caused the volatility in the unit price of First REIT.” The manageradded that it is continually looking at “potential acquisition opportunities as well as the potential means of funding these acquisitions,” and that equity fundraising is possible to fund such acquisitions.)


The 20 Best Singapore Shares to Own For November 2018 and Beyond


In this article, I explored the top 20 shares that emerged from a screen based on theMagic Formula investing strategy that was developed by investor Joel Greenblatt. The approach was outlined in Greenblatt’s investing book,The Little Book That Beats The Market.


The Magic Formula works by ranking stocks according to their cheapnessandtheir quality. Investors must then hold a basket of highly-ranked stocks for one year before repeating the ranking process to create a new bucket of stocks. For those who wish to know the metrics that are used for the screen, you can head to another articlehere.


Shares of Asian Pay Television Trust Crash As Massive Cut In Distributions Announced


On 13 November 2018, Asian Pay Television Trust (SGX: S7OU) closed at S$0.315. But the very next day, the trust saw its units crash 49% to S$0.16.


Asian Pay Television Trust’s fall from grace can be mostly attributed to its poor set of 2018 third-quarter results and a sharp cut in distributions. Chin Hui Leong and Royston Yang jointly study the trust’s latest earnings, and the amount of distributions unitholders can expect to be paid going forward.


$First Reit(AW9U.SI) $Asian Pay Tv Tr(S7OU.SI)

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The Weekly Nibble: A Focus on Singapore Blue-Chip Shares
- Original Post from The Motley Fool Sg

Here are some of the most popular articles that have appeared on The Motley Fool Singapore’s website for the week.


3 Singapore Blue-Chip Shares That Warren Buffett Might Like


Ever wanted to invest in stable companies that are part of the Straits Times Index (SGX: ^STI)? Look no further. In this article, I look at three blue-chips that have wide economic moats and why they could make good investments.


Companies discussed in the article: Singapore Exchange Limited (SGX: S68), DBS Group Holdings Ltd (SGX: D05) and SATS Ltd (SGX: S58).


3 REITS That Have More Than 8% Yield Right Now


Lawrence Nga explores three real estate investment trusts (REITs) that have distribution yields of above 8%. They are not excessively valued in terms of their book values as well.


REITs discussed in the article are Cache Logistics Trust (SGX: K2LU), First Real Estate Investment Trust (SGX: AW9U) and EC World Real Estate Investment Trust (SGX: BWCU).


Which Blue-Chip Property Developer Is The Cheapest Now?


With the additional property cooling measures introduced in July this year, shares of property developers have generally not been doing well. For instance, UOL Group Limited’s (SGX: U14) share price has tumbled close to 20% since the cooling measures were put in place.


Jeremy Chia, in his article, investigates which of the trio of property outfits that are part of the Straits Times Index – UOL, CapitaLand Limited (SGX: C31) and City Developments Limited (SGX: C09) – offer the best value amid the tumbling stock prices.


$STI(^STI.IN) $First Reit(AW9U.SI) $EC World Reit(BWCU.SI) $CityDev(C09.SI) $CapitaLand(C31.SI) $DBS(D05.SI) $Cache Log Trust(K2LU.SI) $SATS(S58.SI) $SGX(S68.SI) $UOL(U14.SI)

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3 REITS That Have More Than 8% Yield Right Now
- Original Post from The Motley Fool Sg

Real estate investment trusts, or REITs, are popular investment choices on the Singapore stock market. That’s because REITs tend to have high distribution yields due to their need to distribute at least 90% of their taxable income to unitholders in order to enjoy tax transparency.


In this article, I will share with you three REITs that are trading at high distribution yields of more than 8%.



Source: SGX StockFacts


We will start with Cache Logistics Trust (SGX: K2LU).As a quick background, Cache Logistics Trust is a real estate investment trust that focuses on logistics properties. It currently has 27 logistics warehouse properties in its portfolio which are located in Singapore, Australia, and China.


In the quarter ended 30 September 2018, Cache Logistics Trust reported that gross revenue grew 14.8% to S$31.5 million while net property income increased by 8.1% to S$23.1 million. The improvement was driven by higher contribution from existing properties and latest acquisitions. Yet, the REIT’s distribution per unit (DPU) was down by 4.3% year-on-year to 1.475 cents, mainly due to lower income for distribution and issue of new units.


As of 30 September 2018, the REIT’s gearing stood at 35.6% and its committed occupancy rate was 96.9%.


Next, we have First Real Estate Investment Trust (SGX: AW9U).As a quick introduction, First REIT is a healthcare-focused REIT with a portfolio of 20 properties (16 in Indonesia, three in Singapore, and one in South Korea). The REIT’s sponsor is Indonesia’s largest listed property company, PT Lippo Karawaci Tbk.


For the quarter ended 30 September 2018, First REIT reported that gross revenue climbed 5.1% while NPI improved 5.4%, respectively, as compared to the same period last year. The improvement was primarily due to contributions from the newly-acquired Siloam Hospitals Buton & Lippo Plaza Buton, and Siloam Hospitals Yogyakarta, as well as increased rental income from existing properties. Consequently, the REIT’s DPU came in at 2.15 cents, 0.5% higher than the same period last year.


Victor Tan, chief executive of First REIT’s manager, made the following comments:


“Contributions from our latest acquisitions and existing properties continued to bolster the Trust’s revenue and NPI in the third quarter. The proposed acquisition of Bowsprit by OUE Lippo Healthcare Limited will be one of our growth drivers. First REIT will then be able to access a more diversified pool of assets via the right of first refusal agreements granted by both OUE Lippo Healthcare Limited and PT Lippo Karawaci Tbk for their portfolios. This will effectively expand First REIT’s geographical catchment within Asia, allowing the Trust to potentially pursue more yield-accretive acquisitions to deliver stable returns to our Unitholders.”


First REIT recently saw its unit price decline by a substantial amount. For those who wish to know more about the development, you can headhere.


Last but not the least, we have EC World Real Estate Investment Trust (SGX: BWCU), or EC World REIT.As a quick introduction, EC World REIT is the first Chinese specialized logistics and e-commerce logistics REIT. It owns properties mainly used for e-commerce, supply-chain management and logistics.


For the quarter ended 30 September 2018, EC World REIT reported that gross revenue came in 0.1% higher year-on-year to S$23.9 million while NPI grew by 0.5% year-on-year to S$ 22.2 million. Similarly, the REIT’s DPU was up by 9.0% as compared to last year to 1.57 cents. EC World REIT’s DPU benefited from lower expenses and the absence of a 5% withholding tax that was charged in 2017’s third quarter. If the impact from the withholding tax is removed, EC World REIT’s year-on-year DPU growth in 2018’s third quarter would be 2.3%.


As of 30 September 2018, the REIT’s gearing was 30.7% and its committed occupancy rate stood at 99.2%.


Goh Toh Sim, CEO of EC World REIT’s manager, shared the following comments on the REIT’s outlook:


“We are delighted to deliver another quarter of healthy distributions for our unitholders despite the macroeconomic headwinds and global uncertainty. EC World REIT’s assets are generally unaffected as the tenants within the portfolio serve primarily the domestic China market focused on domestic consumption. As such, we do not expect the ongoing global uncertainty to have a material negative impact on the operation of our assets.”


Conclusion


So there you go, three REITs that are trading at high yields of 8%. Investors should be reminded, however, that high yields alone are not enough to justify a buy decision. Thus, it is important the investors do their research on the trust’s future income prospects before committing any capital.


$First Reit(AW9U.SI) $EC World Reit(BWCU.SI) $Cache Log Trust(K2LU.SI)

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News Of The Week: What is Ailing First Real Estate Investment Trust?
- Original Post from The Motley Fool Sg

First Real Estate Investment Trust (SGX: AW9U) or First REIT is a healthcare-focused real estate investment trust.


Currently, the REIT’s portfolio has 20 properties (16 in Indonesia, three in Singapore, and one in South Korea) that are mostly healthcare-related facilities. The REIT’s sponsor is Indonesia’s largest listed property company, PT Lippo Karawaci Tbk.


The REIT recently in the limelight as it price fell from around S$1.20 to a low of S$ 0.922 on Tuesday, before recouping some of those losses to close at S$ 1.03 on Friday. Here are three things investors should know about First REIT now.


What did the company say about the stock price decline


Bowsprit Capital (manager of First Real Estate Investment Trust) has recently made an announcement in responding to the decline in share price. My colleague, Sudhan P, shared the announcement in his article here.


Here’s a quick summary of the announcement:


“The Manager is not aware of any material information which has not previously been announced or otherwise made known in the public domain from any source that could have caused the volatility in the unit price of First REIT.”


In short, the manager is saying that it has no information that can explain the recent decline in share price. To get a full picture of the latest update, you can catch up Sudhan P’s article here.


A potential reason for the decline


Although First REIT has not provided any explanation for the decline in share price, my colleague Jeremy Chia (in his article here) has suggested that the decline might be due to the trouble that Lippo Karawaci, First REIT’s sponsor, key tenant, and main revenue contributor, is facing.


Lippo Karawaci (which contributes about 82.4% of First REIT’s 2017 rental income) has seen its rating downgraded by Fitch (one of the three major credit rating agencies) by two notches. The company’s long-term foreign and local currency issuer default ratings was reduced from B to CCC+, as Fitch cited liquidity risks over uncertainty in the company’s asset sales. To learn more about Lippo Karawaci problems, please clickherefor Jeremy’s article.


What investors should do now


If you are an existing investor, or potential investor thinking of buying into First REIT stocks, you might be confused at to what you should do now given the recent sell-off. The good news is, my colleague Sudhan P has shared his thoughtshere about the actions that investor can take.


In his article, Sudhan gave a few options to investors depending on which stage you are in the investment process. Overall, the idea is to stay calm and make rational choices rather than reacting emotionally to the situation. Sound good? Click here to find out more.


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The Weekly Nibble: First Real Estate Investment Trust’s Unit Price Rout
- Original Post from The Motley Fool Sg

Here are some of the most popular articles that have appeared on The Motley Fool Singapore’s website for the week.


Why Did First Real Estate Investment Trust’s Unit Price Plunge Yesterday?


First Real Estate Investment Trust (SGX: AW9U) is a healthcare real estate investment trust (REIT) which owns 20 properties — mostly healthcare-related —in Indonesia, Singapore and South Korea. Most of the REIT’s assets are located in Indonesia.


On Monday and Tuesday this week, the REIT’s unit price plummeted more than 15% to a low of S$0.92 on 20 November. What could be the reason behind the sudden fall? Jeremy Chia investigates in his article.


Which Singapore-Listed Bank Is Cheaper Than The Stock Market Now?


In this article, I look at the price-to-book ratio, price-to-earnings ratio and dividend yield of the trio of banks listed here and compare them with the market’s valuation. The exercise aims to determine which bank could make a bargain share amid the weak stock market. Do jump into the article to know more.


2 REITs With More Than 8% Yields That Could Make Great Investments


Jeremy looks at two REITs that have above 8% distribution yields that could make great long-term investments. One of the REIT owns specialised and e-commerce logistics properties while the other has four outlet malls in its portfolio. Both REITs, though, have a focus on China, the world’s second-largest economy.


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The Market’s Breathing Some Life Into First Real Estate Investment Trust
- Original Post from The Motley Fool Sg

First Real Estate Investment Trust‘s (SGX: AW9U) unit price fell by more than 10% in total from last Friday’s close to this Wednesday (21 November 2018).


No one knew for sure the exact reasons for the fall. It’s not that the real estate investment trust (REIT) had delivered poor financial results recently. In fact, in2018’s third quarter, First REIT’s quarterly gross revenue, net property income, and distribution per unit grew by 5.1%, 5.4%, and 0.5%, respectively, compared to a year ago.


Some possible reasons for the fall in First REIT’s unit price that I noted were:


1) A recent downgradeof Lippo Karawaci’s credit ratings (Lippo Karawaci is First REIT’s sponsor and key tenant);


2) Institutional shareholders selling off their stakes in First REIT due to the downgrade; and


3) Uncertainty with the motive of OUE Ltd’s (SGX: LJ3) and OUE Lippo Healthcare Ltd’s (SGX: 5WA) involvement in First REIT.


Update to the market


As of the time of writing today (22 November 2018), First REIT’s unit price is up 2% to S$1.01 apiece from yesterday’s close at S$0.99. The market could be breathing a sigh of relief.


Last night, the REIT’s manager announced that it is unaware of “any material information which has not previously been announced or otherwise made known in the public domain from any source that could have caused the volatility in the unit price of First REIT.” The manageradded that it is continually exploring “potential acquisition opportunities as well as the potential means of funding these acquisitions,” and that equity fundraising is possible to fund such acquisitions.


Nothing has been cast in stone at the moment when it comes to the acquisition opportunities, and the REIT’s manager will provide more updates if there are any material developments.


Now what?


Raising funds through the stock market could come in the form of (1) a rights issue, which gives existing unitholders the right to buy more shares, or (2) a placement exercise, which would see First REIT offer its units only to a select group of investors. There are pros and cons to each equity fundraising method, but it is futile to discuss them now since First REIT’s acquisition plans are not known yet.


For now, though, it looks like Mr Market’s happy that it’s business at usual at the REIT. At First REIT’s unit price of S$1.01 currently, the REIT has a price-to-book ratio of 1 and has a distribution yield of 8.5%.


$First Reit(AW9U.SI)

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