ARREIT is my favorite recovery play MREIT, not exactly everyone’s choice right now, because this REIT had a little bit wild past even before COVID, but in my opinion, ARREIT has a good hidden value and a good outlook for the future.
Generally, REIT prices are still depressed across the board, so there are many gems hiding for value investors to discover, with great dividend potential right now already and a good price appreciation going forward. ARREIT has very strong and valuable portfolio and the rental income is at the bottom already.
Fast look at the chart from 4. June 2021
I don’t want to go into details describing what this particular REIT is all about, as it is found described everywhere and the latest details about their properties and occupancy rates can be found on bursa website in their financial result reports.
Shortly – the most important to watch is a Holiday Villa Alor Star (trouble maker) and recent big bet by ARREIT – The Intermark Vista (low occupancy right now).
For me is not important any “short term issue”, as it is really recovery play for me, so I look into future, when everything normalize and ARREIT gets back on the track – and it will eventually!
So now question is, what we are getting from them right now and what we can gain in the future?
Price at 4/6/2021: 0.65 RM
Trailing EPS last 4QR: 4.54 sen
Trailing P/E: 14.32
OK, so right now it looks like its well priced by PE ratio, BUT its elevated because of the last year “covid troubles”, NAPS is over 2x higher compared to the market price and last year dividend of 4.4 sen equal to 6.77% DY and the last QR is starting to look more promising with EPS 1.56 which I believe is what we can expect for the remaining of this year and increasing once covid scare go away.
EPS 2021 forecast: >6 sen (conservative prediction)
Target price: 0.75 RM (15% upside)
Target DY: 8.5% (5.5 sen)
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Disclosure: Im holding ARREIT
Disclaimer: Im not a professional financial advisor or a financial analyst or an economist or an accounter.
This is not a trading recommendation / advise, just my personal view