Price for reits seems are getting to their fair value, some of the reits market price already went above its nav, yield are mostly in a range of 5% to 7%, price/book ratio >1 and with high gearing. It seems not too attractive to me anymore when other high yield stocks are offering the similar yield with a healthy balance sheet.
90% distribution of the income for the reit is not a must nowadays. To archieve a better gearing, healthier balance sheet and fulfil the loan convenant, more than 20% of income will be retained to fulfil the truts' need. This means the reduction of DPU and lower yield.
Would the current downtrend be the correction period which just temporarily? Hunting a value stock with a long term prospect still the right strategy.
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