Monday, 24 August 2015

Stock Analysis Marathon : CapitaLand Commercial Trust, Frasers Commercial Trust, AIMS AMP Capital Industrial Reit, UOB, Accordia Golf Trust, Keppel Corporation, Starhub, Far East Hospitality Trust

The recent drops in the stock market have again reminded us that we need to prepare our data beforehand so you can execute any trade that you desired within a day.

I am not going to kill myself by working too hard on stock analysis. I am going to do a simplified way of analysing the stocks. This is also why I like ETF investing methodology.



This is not a stock tip! It is for my personal reference. Follow at your own risk!

CapitaLand Commercial Trust

Occupancy rate: 99.7% (Weighted average lease expiry of 8.1 years)
Gearing: 29.5%
Yield: Growing DPU. Current: 6.6% (as at price of $1.295)
NAV per unit: 1.72
Price/Book Value: 0.735
Long Term Sustainability: Good fundamental with excellent strategic office locations.

My Verdict: Fair Value: $1.295, Min Entry Price (15% buffer) : $1.1  <10% asset allocation

Frasers Commercial Trust

Occupancy rate: 96.5% (Weighted average lease expiry of 3.4 years)
Gearing: 37.3%
Yield: Growing DPU. Current: 7.43% (as at price of $1.265)
NAV per unit: 1.59
Price/Book Value: 0.81
Long Term Sustainability: Good fundamental with strategic office locations

My Verdict: Fair Value: $1.3, Min Entry Price (15% buffer) : $1.075. <10% asset allocation

AIMS AMP Capital Industrial REIT

Occupancy rate: 96.1% (Weighted average lease expiry of 3.11 years)
Gearing: 31%
Yield: Growing DPU for the past years. Current: 8.22% (as at price of $1.37)
NAV per unit: 1.52
Long Term Sustainability: Still positive for at least another 3 years. In addition, 30 & 32 Tuas West Road Projects Redevelopment

My Verdict: Fair Value: $1.4, Min Entry Price (15% buffer) : $1.19. <10% asset allocation

UOB

Yield: Current: 4.45% (as at price of $19.11)
Price/Book Value: 1.002
NAV per unit: 17.71

My Verdict: Fair Value: $17.26, Min Entry Price (15% buffer) : $14.67. <10% asset allocation

Accordia Golf Trust

Gearing: 30.1%
Yield: Growing DPU. Current: 13.94% (as at price of $0.635)
NAV per unit: 0.792
Price/Book Value: 0.732
Long Term Sustainability: Good fundamental with great dividends. Currency risk.

My Verdict: Fair Value: $0.635, Min Entry Price (15% buffer) : $0.54. <5% asset allocation

Keppel Corporation
I can never fully internalise their businesses. It is gigantic but it is not going to stop me from learning more.
Earlier, I have blogged about it here and here. If you are keen to invest in Keppel Corporation, I would recommend you to read their recent dialogues during their earning conference. Most of the questions you can think of are being asked. I would highlight a few:

1) Annualised ROE for the period was 13.1%, while EVA was S$225 million
2) Dividends yield of 7.05% (as at price of $6.80)
3) Keppel Offshore & Marine has a net orderbook year to date which stands at $11.0 billion, which is keeping their yards busy through to 2020.
4) Through 47 years since incorporation, Keppel has grown stronger from every downturn and has been able to continuously integrate and streamline its business units to create value. Examples:
    4.1) In early 2000s, shortly after the Asian financial crisis, they consolidated and sold their banking and finance arm.
    4.2) With proceeds from the divestment, in the wake of September 11, they integrated their shipyard operations to form Keppel Offshore & Marine (Keppel O&M), which resulted in over a decade of unprecedented growth.
    4.3) More recently, they re-organised the Infrastructure Division and formed Keppel Infrastructure, with a focus on energy. They are growing Keppel Infrastructure Trust into a sizeable vehicle for Keppel Infrastructure to unlock value from mature assets and reinvest capital in new projects for higher returns. The same is being done with Keppel DC REIT. Finally, with Keppel Land privatised, it will enable them to deploy capital across their businesses more effectively and their property division can focus on generating stronger returns.

Seriously, we can't be emotional and fall in love with the stock we are looking at. Our ultimate objective is to grow our money and live our life meaningfully, not to flourish or perish with the company.
However, Keppel Corporation has given me extraordinary assurance and confidence that they can emerge stronger.

My Verdict : Fair value: $6.80. My Min Entry Price (15% buffer) : $5.78. <10% asset allocation

Starhub

Dividends: Consistent at $0.20 per year. Current: 5.54% (as at price of $3.61)
Price/Book Value: 40.262

My Verdict : Fair Value: $3.30, Min Entry Price (15% buffer) : $2.80. <5% asset allocation

Far East Hospitality Trust

Occupancy rate: 84.5% (Hotel) / 87.5% (SR)
Gearing: 31.4%
Yield: Decreasing DPU. Current: 8.12% (as at price of $0.595)
NAV per unit: 0.9655
Long Term Sustainability: Depending on Singapore tourism performance. With an uncertain global economic environment and a relatively strong Singapore dollar, softness in both corporate and leisure travel demand may persist. Coupled with a supply of approximately 4,300 new hotel rooms this year3, the operating environment is expected to remain competitive.

My Verdict: Fair Value: $0.6, Min Entry Price (15% buffer) : $0.51. <5% asset allocation

If I can't hit any of my entry price, I will continue to average down my STI ETF or explore other stocks. Life goes on. Remember to apply asset allocation strategy. Accumulate slowly, unless you are rushing for retirement.

What about you?


4 comments:

  1. sounds easy... a plan is always good

    ReplyDelete
    Replies
    1. Hi Rolf

      Still in China? It is staying discipline to the plan and being flexible to changing world that is challenging

      Delete
  2. Keppel fair value at $6.80?

    You never give face to those who bought above $10?

    Tsk, tsk.

    LOL!

    ReplyDelete
    Replies
    1. Hi SMOL

      I don't want to rub salt onto someone's wound by commenting on it. Lol.

      You are opportunist, so am I. Prices change every day, so do people.

      Delete