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.

Wednesday, November 1, 2017

Analysis of Viva Industrial Trust - Is it time to sell?

Current Price on 31st October 2017 = $0.98
  • Yield = 7.76%  
  • Price-to-book Ratio = 1.241
  • Assets per unit = $1.37
  • Debt per unit = $0.58 (including current liabilities)
  • Gearing = 42.3%
Viva Industrial Trust has been moving up by quite a lot ever since they publish a good set of results. Let's take a look at the statistics.

With a yield of 7.76%, it is probably quite decent by today's standards. Even though it is below my target, it is still quite high comparable to other REITs. The problem is that their price-to-book ratio is 1.241 which means we are buying at a 24% premium. Not very sure why the valuation is so low when the yield can be so high. Is there something that I missed? Gearing is at 42.3%. Decent but high.

I am vested with 87,100 shares which I bought long time ago. With the run-up in share price and its high price-to-book ratio, I may be looking to sell them, take profit and switch it to another REIT. It may not increase the yield but at least the margin of safety would be bigger. One possible target is Soilbuild Business Space REIT which has fallen by quite a bit recently. Nevertheless, I need to be able to find a target as there are very few opportunities left in the market.

No comments:

Post a Comment