S-REIT Investment Blog: Analysis of FCOT

Welcome

Welcome to my investment blog where I share with you my analysis of REITs in Singapore.

I hope that my investment philosophy will bring me a steady stream of income apart from my job. I am aiming for at least $3,000 per month which can sustain the current expenses of myself and my family.

Do enjoy reading my blog and post any comments that you have. I welcome them because it is a time to learn from each other.

When I am looking at investing in REIT, here are some of the guidelines that I am looking at. Feel free to comment on it. I am willing to listen to ideas.

-> at least 8% yield.
-> Price that is lower than its NAV.
-> Low gearing (if possible)
-> High secured NAV.

Current Dividend income is $3,800/month.

Tuesday, October 26, 2010

Analysis of FCOT

Current Price on 22nd Oct 2010 = $0.165

Current Yield = 7.52%
Price-to-book Ratio = 0.598
Assets per unit = $0.563
Debt per unit = $0.287
Gearing = 51.0% (excluding CPPU)

FCOT has managed to improve its yield to one which is close to my threshold. Moreover, its price-to-book ratio is very low which makes it attractive. The only problem is its high debt and gearing (excluding CPPU). Compared to other REITs, it is less likely to grow until it solves its debt and equity problems.

I am waiting for the price to drop to 0.155 gives me 8% yield and my likely price to invest in FCOT. Hopefully after it goes XD, there will be a drop in price which gives me a chance to enter the market.