Shares & Derivatives
First REIT: 1Q 2012 DPU 1.93c and a higher fair value?
By A Singaporean Stockmarket Investor (ASSI)  •  April 21, 2012
First REIT has declared a DPU of 1.93c. The unit price of First REIT has been rising steadily. It is clear that Mr. Market is willing to pay a gradually higher price for the REIT's units which leads me to wonder if we could see First REIT's distribution yield compressing to 6% which would bring it closer to PLife REIT's distribution yield which is currently under 6%. This could see the REIT's unit price going to $1.06.
When calculating distribution yield, I would rather use a DPU of 1.6c per quarter instead of 1.93c. Why? When we look at the numbers, we would see that the net property income (NPI) has improved 6% while distributable income has improved some 22%. This is because First REIT is still paying out its gains from divesting its Adam Road property. If we remove this component, the DPU should hover at 1.6c ......
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By A Singaporean Stockmarket Investor (ASSI)
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