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The challenge with REITs is not the current yield. It it how the REIT is going to grow over the next few years. If they are thinking of issuing more units, then it will dilute whatever earnings they have.
I think Hektar is not going to issue more units for the time being after they had exercised IDRP early this year... so need no worry much about the dilution of EPS for the next few quarters ~
high inflation/cost of living, squeezed on disposable income, weak retail sales.
their neighbourhood malls are old & struggling to stay relevant, can maintain rental is good liao, let alone talk abt growth.....
The goal on a REIT is not just to maintain the current earnings but to grow. Growth be organic but most REITS grow by acquisitions. This is where the concern on how they raise funds come in.
My horror story with REIT is that I bought them for the dividend yield. Then they started to grow by issuing new capital that although I continued to subscribe it was not value accretive. REITS distribute almost all its earning and as such do not have any retained earnings for expansion. So they either borrow or dilute the existing shareholders value. So it is not that I want growth. It is that growth destroyed the value if REITS don't do it well. And most have not done it well.
Can't agree more, wrong acquisition will dilute its earning, in this case u should target the best out of here, Igbreit or sunreit, rental grow over years, this counter at this price ppl not only target the dividend but also capital gain, in stock market, margin of safety is the must learn subject
So far Hektar doesn't have wrong acquisition and its NAV per unit was increased from RM1.16 in FY2021 to RM1.27 in FY2022. So Hektar is still undervalued currently
To be transparent I have investments in Hektar and I did an analysis in my blog titled "Do I swap my office REIT with Hektar REIT?" My conclusion was "The number of units in Hektar increased from 320 million units in 2007 to 469 million units in 2022 while the financial performance deteriorated. This meant that on a per unit basis, unitholders were worse off in 2022 compared to 2007." If you want the details go to https://www.i4value.asia/2023/01/do-i-swap-my-office-reit-with-hektar.html#more
Office REIT stocks, in particular, were the worst-performing REIT stocks across all property types... Time has changed, people are working remotely now despite some are back to office
When we talk about investing today, there are two groups of investors. First there are those who are thinking of going in. Next we have those who went in pre-Covid and is now holding the stocks. What to do and how to analyse the situation is different for both groups. Unfortunately I belong to the latter group. So the question is do you exit or hold?
Be Frank, Hektar price drop due to right issue share, they offer too many right issue share make their revenue cant sustain so many share dividend. and those right issue share money dont know go where already.... but i can said Hektar NAV still maintain at Rm 1.10. but Hektar want go further to Rm 1.40 or 1.50 is become impossible now...
The corporate exercise of right issue only happened in 2012 and 2017...don't think they will do that anymore to dilute EPS as its cash flow is quite healthy. Will it go up to RM1 and above? Only GOD will know. Ha
JSL haha what make you think it could go back to rm1.4? The share price hasn't been > book value for long time, pls refer to the past records. Your valuation technique is abit off
