Sasseur Real Estate Investment Trust’s Share Price Surged 26%. Is It Still a Good Buy?
Sasseur Real Estate Investment Trust (SGX: CRPU) is the first outlet mall REIT listed in Asia. It invests in the retail outlet mall sector in the People’s Republic of China through its initial portfolio of four outlet mall in Chongqing, Kunming, and Hefei.
After touching a low of S$0.635 early this year, Sasseur REIT’s share price has surged by 26%! Investors might want to know if the stock has more room to grow — and if Sasseur’s shares are cheap now. If they are, it might be a good opportunity to ride the upward trend.
Unfortunately, there is no easy answer. However, we can still get some insight by comparing Sasseur REIT’s current valuations with the market’s valuation. The two valuation metrics I’ll focus on are the price-to-book (P/B) ratio and the distribution yield.
I will be using the average P/B ratio and distribution yield for the 42 REITs that are listed in Singapore’s stock market. With that, let’s look at the comparison below:
Source: Yahoo! Finance, OCBC Weekly S-REITs Tracker
From the above, we can see that Sasseur REIT’s distribution yield is higher than that of the market average, indicating that it’s trading at a lower valuation. Similarly, its P/B ratio is lower than that of the market average.
The Foolish bottom line
In sum, we can argue that Sasseur REIT is trading on the lower end of the valuation spectrum given its high distribution yield and low P/B ratio when compared to the market average.
Thus, investors can still consider this REIT despite its recent stock price performance.
The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn’t own shares in any companies mentioned.
This content was originally published here.