A-REIT valuation model

[nulla nulla]

A-REIT Sector: Weekending Friday 09 September 2016


Since 01 August 2016, the A-REIT sector has dropped form an inter-day high of 1562.3 to close out on Friday 09 September 2016 at 1417.697, a drop of near enough 10%. Is this the correction we had to have? Are we at a point from which we will again move sideways and upwards or is it the start of a bigger bear cycle?









The comparison table of this weeks closing prices versus last weeks closing prices follows:






Comments:

1. The shares listed in the tables above make up the XPJ A-REIT Property Sector.

2. The "Capital" figures in the above tables are "market capital" based on the "issued shares" as distinct from "free float capital". The "issued shares", updated as at 27 May 2016, can change from day to day due to active share buy-back programs and other factors.

3. The "Earnings", "Distribution" and "NTA" figures have also been updated as at 27 May 2016. "NTA" figures are subject to change every time there is a property re-valuation and the table may be out by a few cents from time to time, which effects the "Premium to NTA" also.

4. The share codes listed in both Tables now hyper-link to the last page (mostly) of the corresponding ASF thread for that share.

5. Inclusion of any share details in the above tables is not an endorsement of that share as a viable investment or possible trade.

Disclaimer: These tables may contain errors and should not be relied upon for investment decisions. As always, do your own research and good luck .

 

[nulla nulla]

A-REIT Sector: Weekending Friday 16 September 2016

Monday wasn't our best day as the All-Ords (and the A-REIT'S) followed the lead from the Dow-Jones on the previous Friday. A lot of dithering around on Tuesday through Thursday with the Australian Markets clawing back some of their losses on Friday. Then of course the Dow-Jones dropped again on their Friday, likely setting another lead for our markets on Monday. Gotta love the volatility. Some of the A-REIT's are starting to look attractive again. Watch out for the impact of any further talk of Australia heading into Recession.




The A-REIT Table for closing prices for Weekending 16 September 2016 follows:




The comparison table of this weeks closing prices versus last weeks closing prices follows:






Comments:

1. The shares listed in the tables above make up the XPJ A-REIT Property Sector.

2. The "Capital" figures in the above tables are "market capital" based on the "issued shares" as distinct from "free float capital". The "issued shares", updated as at 27 May 2016, can change from day to day due to active share buy-back programs and other factors.

3. The "Earnings", "Distribution" and "NTA" figures have also been updated as at 27 May 2016. "NTA" figures are subject to change every time there is a property re-valuation and the table may be out by a few cents from time to time, which effects the "Premium to NTA" also.

4. The share codes listed in both Tables now hyper-link to the last page (mostly) of the corresponding ASF thread for that share.

5. Inclusion of any share details in the above tables is not an endorsement of that share as a viable investment or possible trade.

Disclaimer: These tables may contain errors and should not be relied upon for investment decisions. As always, do your own research and good luck .

 

[nulla nulla]

A-REIT Sector: Weekending Friday 23 September 2016


On 09 September 2016 the A-REIT Sector closed at 1417.697, a drop of near enough 10% since early August. In the next three days trading the A-REIT Sector fell to an inter-day low of 1353.2 before recovering to close the day at 1378.597, down a further 3%.

On Friday 23 September 2016 the A-REIT Sector closed out the week at 1417.456, taking eight trading days to recover from the one days losses on 12 September 2016. This sector is still down 10% from the August highs. On Friday night (our time) the Dow-Jones dropped 130 points. Likely our markets will fall on open tomorrow and the volatility will continue. Good luck.





The A-REIT Table for closing prices for Weekending 23 September 2016 follows:




The comparison table of this weeks closing prices versus last weeks closing prices follows:



Comments:

1. The shares listed in the tables above make up the XPJ A-REIT Property Sector.

2. The "Capital" figures in the above tables are "market capital" based on the "issued shares" as distinct from "free float capital". The "issued shares", updated as at 27 May 2016, can change from day to day due to active share buy-back programs and other factors.

3. The "Earnings", "Distribution" and "NTA" figures have also been updated as at 27 May 2016. "NTA" figures are subject to change every time there is a property re-valuation and the table may be out by a few cents from time to time, which effects the "Premium to NTA" also.

4. The share codes listed in both Tables now hyper-link to the last page (mostly) of the corresponding ASF thread for that share.

5. Inclusion of any share details in the above tables is not an endorsement of that share as a viable investment or possible trade.

Disclaimer: These tables may contain errors and should not be relied upon for investment decisions. As always, do your own research and good luck .

 

[nulla nulla]

A-REIT Sector: Weekending Friday 30 September 2016




This weeks excuse for a major sell off (and subsequent buy back) was Deutche Bank. Seems they were fined US$15 Billion by the U.S.A for being naughty boys and girls selling worthless derivatives back in the GFC. The German Government let it be known that they would not provide a bail-out for the bank. The share price of Deutche bank fell 65% this year but the global markets seem to have only started rumbling 2 weeks or so ago. The Dow-Jones had a hissy fit, the Dax had a panic attack and the doom and gloomers started selling off everything except resources.

Resources went up because the OPEC cartel decided to cut back supply and the price of oil (and petrol at the bowser) jumped by 10%. Meanwhile Deutsche Bank negotiated with the U.S.A and got the fine reduced to around US$5 billion and the Dow-Jones roared back up. And the volatility in out markets continues. Good luck.


The A-REIT Table for closing prices for Weekending 30 September 2016 follows:




The comparison table of this weeks closing prices versus last weeks closing prices follows:




Comments:

1. The shares listed in the tables above make up the XPJ A-REIT Property Sector.

2. The "Capital" figures in the above tables are "market capital" based on the "issued shares" as distinct from "free float capital". The "issued shares", updated as at 27 May 2016, can change from day to day due to active share buy-back programs and other factors.

3. The "Earnings", "Distribution" and "NTA" figures have also been updated as at 27 May 2016. "NTA" figures are subject to change every time there is a property re-valuation and the table may be out by a few cents from time to time, which effects the "Premium to NTA" also.

4. The share codes listed in both Tables now hyper-link to the last page (mostly) of the corresponding ASF thread for that share.

5. Inclusion of any share details in the above tables is not an endorsement of that share as a viable investment or possible trade.

Disclaimer: These tables may contain errors and should not be relied upon for investment decisions. As always, do your own research and good luck .

 

[nulla nulla]

A-REIT Sector: Weekending Friday 07 October 2016


It would seem that some Fund Managers have taken a set against the A-REIT's on the basis that the Australian Commercial Property Market is over inflated and due for a correction, so now is a good time to sell down A-REIT's. This is an interesting position for them to take as the Australian economy is steadily advancing, employment figures are good, inflation figures are on the low side, consumer confidence is high and retail spending is high. In fact consumer credit card debt is high as people spend, confident of their ongoing employment and their ability to service debt. Small business demand for office space is high, demand for affordable living is high and (as yet) the residential property market is absorbing the apartments developments reaching completion. Yields are high at the current level of prices and the likelihood of A-REIT's falling over in the present economical environment must be miniscule, so why the sell off? Good luck.




The A-REIT Table for closing prices for Weekending 07 October 2016 follows:




The comparison table of this weeks closing prices versus last weeks closing prices follows:




Comments:

1. The shares listed in the tables above make up the XPJ A-REIT Property Sector.

2. The "Capital" figures in the above tables are "market capital" based on the "issued shares" as distinct from "free float capital". The "issued shares", updated as at 27 May 2016, can change from day to day due to active share buy-back programs and other factors.

3. The "Earnings", "Distribution" and "NTA" figures have also been updated as at 27 May 2016. "NTA" figures are subject to change every time there is a property re-valuation and the table may be out by a few cents from time to time, which effects the "Premium to NTA" also.

4. The share codes listed in both Tables now hyper-link to the last page (mostly) of the corresponding ASF thread for that share.

5. Inclusion of any share details in the above tables is not an endorsement of that share as a viable investment or possible trade.

Disclaimer: These tables may contain errors and should not be relied upon for investment decisions. As always, do your own research and good luck .

 

[nulla nulla]

A-REIT Sector: Weekending Friday 14 October 2016


More of the same. This week it is the figures coming out of China, the likelihood of the Russian's cutting oil production in line with the United Arabic Nations and the US interest rates likely to go up. The A-REIT's struggled sideways then lifted slightly when the finance and resource sectors took hit on Thursday/Friday. Maybe this is a prelude to the old November retrace?





The A-REIT Table for closing prices for Weekending 14 October 2016 follows:





The comparison table of this weeks closing prices versus last weeks closing prices follows:




Comments:

1. The shares listed in the tables above make up the XPJ A-REIT Property Sector.

2. The "Capital" figures in the above tables are "market capital" based on the "issued shares" as distinct from "free float capital". The "issued shares", updated as at 27 May 2016, can change from day to day due to active share buy-back programs and other factors.

3. The "Earnings", "Distribution" and "NTA" figures have also been updated as at 27 May 2016. "NTA" figures are subject to change every time there is a property re-valuation and the table may be out by a few cents from time to time, which effects the "Premium to NTA" also.

4. The share codes listed in both Tables now hyper-link to the last page (mostly) of the corresponding ASF thread for that share.

5. Inclusion of any share details in the above tables is not an endorsement of that share as a viable investment or possible trade.

Disclaimer: These tables may contain errors and should not be relied upon for investment decisions. As always, do your own research and good luck .

 

[peter2]

It's interesting to see this sector get pummeled by persistent selling. Prices will get so low that value investors will start buying eventually.

Nulla, are you waiting for premium values to get into a historically attractive "buyable" range?

 

[InsvestoBoy]

It's interesting to see this sector get pummeled by persistent selling. Prices will get so low that value investors will start buying eventually.

Nulla, are you waiting for premium values to get into a historically attractive "buyable" range?

The sector has been on a slow and steady rise since 2012, quite some time. Obviously it could develop into something much worse, but otherwise I think this sort of pullback can just as likely be healthy correction of that ongoing uptrend.

Disclaimer: I hold some REIT stocks.

 

[notting]

Pretty damn big trend ending mother of a head and shoulders forming on MGR.
LLC presentation didn't go down to well yesterday either!!! (you'd think that 32B in the UK (LLC biggest international footprint by a mile) would be causing a bit of skittishness, not just due to property prices coming off significantly but the pound)

First the Casinos then maybe the ausi apartment splurge is about to be cracked down upon by the Chinese dictatorship!!

Sell your houses, go short on Reits then by an apartment block after the collapse. (I am joking) You could do a bit of that but.

PS. Are you allowed to put brackets within brackets in English or is that just for mathematicians and dyslexics?

 

[nulla nulla]

It's interesting to see this sector get pummeled by persistent selling. Prices will get so low that value investors will start buying eventually.

Nulla, are you waiting for premium values to get into a historically attractive "buyable" range?

Already bought some at attractive yield levels. Watching and waiting to see how far it can go before buying/trading more. The Chinese crack down on gambling has made me wonder if Chinese investment in foreign property will be curtailed as this has previously been muted as a means of Chinese money laundering.

The biggest recent surge in A-REIT's was driven by negative interest bank rates (Europe & Japan) pushing foreign funds into A-REIT yields. I suspect there are a lot of foreign investment funds watching for entry points (if they are not already accumulating). Property prices are drawing a lot of political comment at the moment which is contributing to the pressure on A-REIT's. How much of it is popular grandstanding and hot air remains to be seen. The opening up of more crown land for residential development could play into the hands of some of the A-REIT's such as SGP.

Personally I don't trust fund managers spouting "sell A-REIT's" as it is a real possibility that they will stock up before they then recommend "buy" to their clients.

The weekly update has been delayed as I was interstate on the week-end (Friday-Monday) with no internet access.

 

[Bill M]

It's interesting to see this sector get pummeled by persistent selling. Prices will get so low that value investors will start buying eventually.

I am interested on buying the Vanguard REIT index ETF, quote VAP.

Last year at around this time the ETF was around $71.61 returning about 4.7%

This year the ETF is around $76.68 and returning about 5%.

I do not buy anything that doesn't return at least 5% so at these prices it is reasonable value and I cover the whole sector.

Today it might be an up day, so I will wait a few sessions until it slips back to around $76 and then I will buy it for my super as long term income. I could get better returns buy picking a few of my own but I prefer the safety of the ETF for a slightly lower return, cheers.

 

[Bill M]

Today it might be an up day, so I will wait a few sessions until it slips back to around $76 and then I will buy it for my super as long term income. I could get better returns buy picking a few of my own but I prefer the safety of the ETF for a slightly lower return, cheers.

Today it reached my value point and I bought in at $75.16

 

[skc]

The biggest recent surge in A-REIT's was driven by negative interest bank rates (Europe & Japan) pushing foreign funds into A-REIT yields. I suspect there are a lot of foreign investment funds watching for entry points (if they are not already accumulating). Property prices are drawing a lot of political comment at the moment which is contributing to the pressure on A-REIT's. How much of it is popular grandstanding and hot air remains to be seen. The opening up of more crown land for residential development could play into the hands of some of the A-REIT's such as SGP.

REITs prices have little to do with underlying property prices - that's why they are trade at a premium to NTA - it's all to do with the yield spread vs whatever risk free rate the buyer like to compare with. And it doesn't matter which rate these days... most of them are zero or less!

The NTA of a property is kind of a joke anyway. They get NTAs from "independent" valuations - which are probably as independent as S&P rating subprime mortgage CDO's. And valuations are derived by and large from the discount rate. There is not such thing as a true and tangible discount rate.... it's really what the other people are willing to pay.

And in an era where people are willing to pay NEGATIVE rates for bonds, it's no wonder that they are will to pay a high price (i.e. low discount rate) for REITs.

Just got to be careful when the sentiment reverses... which could be now.

 

[kid hustlr]

REITs prices have little to do with underlying property prices - that's why they are trade at a premium to NTA - it's all to do with the yield spread vs whatever risk free rate the buyer like to compare with. And it doesn't matter which rate these days... most of them are zero or less!

The NTA of a property is kind of a joke anyway. They get NTAs from "independent" valuations - which are probably as independent as S&P rating subprime mortgage CDO's. And valuations are derived by and large from the discount rate. There is not such thing as a true and tangible discount rate.... it's really what the other people are willing to pay.

And in an era where people are willing to pay NEGATIVE rates for bonds, it's no wonder that they are will to pay a high price (i.e. low discount rate) for REITs.

Just got to be careful when the sentiment reverses... which could be now.

Really sound post SKC

 

[nulla nulla]

A-REIT Sector: Weekending Friday 28 October 2016


Freefall is probably the best word I can think of to describe the present state of the A-REIT Sector. The three (3) year chart shows the severity of the drop in the sector since August this year. The market has certainly corrected any exuberance in share price values bought on by the influx of cheap foreign currency since April this year. Now it seems we have to watch and see as to whether the share prices will continue to drop to or below the September 2015 values. Earnings have mostly gone up, distributions have mostly gone up and NTA values have increased. However some of the share price premiums to NTA have dropped back significantly. [NTA is not an indicator on its' own of a companies share value as most of the A-REIT's have sold off assets while retaining management rights and an income stream from them. However I consider that you might reasonably expect an A-REIT share to trade at or above this level.]

Property prices have held up (commercial and residential), occupancy rates are high, retail sales are higher (which is good for the shopping centre owners except Bunnings Warehouse Properties who are on notice that several locations will not be renewing their leases) and unemployment figures are at low levels. So why the doom and gloom? Why the low (and getting lower) price earnings ratios?

The tables represent the changes since weekending 14 October 2016.





The A-REIT Table for closing prices for Weekending 28 October 2016 follows:




The comparison table of this weeks closing prices versus last weeks closing prices follows:




Comments:

1. The shares listed in the tables above make up the XPJ A-REIT Property Sector.

2. The "Capital" figures in the above tables are "market capital" based on the "issued shares" as distinct from "free float capital". The "issued shares", updated as at 28 October 2016, can change from day to day due to active share buy-back programs and other factors.

3. The "Earnings", "Distribution" and "NTA" figures have also been updated as at 28 October 2016. "NTA" figures are subject to change every time there is a property re-valuation and the table may be out by a few cents from time to time, which effects the "Premium to NTA" also.

4. The share codes listed in both Tables now hyper-link to the last page (mostly) of the corresponding ASF thread for that share.

5. Inclusion of any share details in the above tables is not an endorsement of that share as a viable investment or possible trade.

Disclaimer: These tables may contain errors and should not be relied upon for investment decisions. As always, do your own research and good luck .

 

[Toyota Lexcen]

yes very frustrating NN,

 

[peter2]

Would it be logical to assume that whatever reason exists for selling the REIT sector, would apply to the selloffs in SYD and TCL?

 

[skc]

Would it be logical to assume that whatever reason exists for selling the REIT sector, would apply to the selloffs in SYD and TCL?

Absolutely.

And the utilities stocks also - APA, SKI, AST, DUE being the big ones.

And to a lessor extent - TLS.

 

[nulla nulla]

Would it be logical to assume that whatever reason exists for selling the REIT sector, would apply to the selloffs in SYD and TCL?

View attachment 68632

Absolutely.

And the utilities stocks also - APA, SKI, AST, DUE being the big ones.

And to a lessor extent - TLS.

Yes. Infrastructure, A-REIT's, Utilities and to some extent Banks. It appears to be mostly driven by the large funds moving their investments into shares such as resources which are coming off lows and are perceived to offer more growth opportunity in the near future.

 

[nulla nulla]

A-REIT Sector: Weekending Friday 04 November 2016


Lets see what happens on Thursday/Friday this week.





The A-REIT Table for closing prices for Weekending 04 November 2016 follows:




The comparison table of this weeks closing prices versus last weeks closing prices follows:




Comments:

1. The shares listed in the tables above make up the XPJ A-REIT Property Sector.

2. The "Capital" figures in the above tables are "market capital" based on the "issued shares" as distinct from "free float capital". The "issued shares", updated as at 28 October 2016, can change from day to day due to active share buy-back programs and other factors.

3. The "Earnings", "Distribution" and "NTA" figures have also been updated as at 28 October 2016. "NTA" figures are subject to change every time there is a property re-valuation and the table may be out by a few cents from time to time, which effects the "Premium to NTA" also.

4. The share codes listed in both Tables now hyper-link to the last page (mostly) of the corresponding ASF thread for that share.

5. Inclusion of any share details in the above tables is not an endorsement of that share as a viable investment or possible trade.

Disclaimer: These tables may contain errors and should not be relied upon for investment decisions. As always, do your own research and good luck .