Portfolio @ July 2018

July

July is almost in the books, so it’s once again time for a portfolio review.

PortfolioPortfolio Value

Performance Indicators / Dividends

  • YTD Time weighted return: 3.24%
  • Dividends collected: $1,497.64
  • Upcoming Dividend Receipts:
    • Frasers Logistics & Industrial Trust: SGD 151.50
    • SingTel: SGD 652.70
    • Keppel Corp: SGD 195
    • Capitaland Mall Trust: SGD 106.78
    • AIMSAMP Capital REIT: SGD 150
    • Starhill Global REIT: SGD 163.50

Commentary

All dogs have their day

July has been kind to me, with portfolio value rising to an all time high of $129k. If you take into account dividends that has XD but are yet to be paid, that’s $130k there. This month’s performance was driven by pretty epic recoveries in my dogs SingTel and Starhill Global REIT and further augmented by gains in Capitaland Mall Trust, Alphabet, Visa and Bank of America. My investments in SingTel and Starhill still slightly remain underwater, but this recovery helped ease the mental torture. This episode has and continues to remind me that panic selling never made anyone money.

Recent Moves

I only made 2 moves this month, re-entering Frasers Property Ltd the day after the Government’s ruthless ABSD and TSDR adjustments and Facebook yesterday after “disastrous” quarterly reporting results. As mentioned previously, I tried for the Koufu IPO, but wasn’t allocated any.

With regards to Frasers Property, I felt the market did not fully understand their business model and geographic reach. Frasers Property has moved away from their property development roots into the recurring income property segments, with more than 80% of assets in these categories (Source: FY2017 Annual Report). What this means is greater earnings stability and less development activities, especially in the residential market – the area hardest hit by the Government’s property cooling measures. Add the fact that Singapore only accounts 33% of 2017 revenues (of which about half relates to residential developments), a juicy 5% dividend and 30% discount to book value, it seemed like a no-brainer. The market seems to agree with the subsequent steady recovery.

As for Facebook, its more of a vote of confidence in Mark Zuckerberg than anything else. Yes, Facebook platform growth is stagnating, but based on past experience, FB management always finds a way. With a giant economic moat and many monetization levers yet to be pulled, the decline seems overly done. Time will tell if my faith was misplaced.

Earnings review

Most of my portfolio stocks/REITs have reported quarterly earnings, so here’s some quick thoughts on them:

  1. AIMSAMP Capital REIT – Steady quarter, environment continues to be challenging,
  2. Capitaland Mall Trust – Pretty good quarter, 2.2% y-o-y DPU increase, 0.8% positive rental reversions, AEI at Westgate, Gearing drop to 31.5% – potential acquisitions incoming (hopefully), good stuff.
  3. Keppel Corp – Honestly a pretty meh quarter, special dividend is nice. In separate news, noted Keppel Urban Solutions and Keppel Capital signing some partnerships/MOUs with ST Engineering and MindChamps for smart cities and early childhood property assets respectively, which I found interesting.
  4. Starhill Global REIT – Stabilised DPU decline at 1.09 cents, Good to see office occupancy increasing to 95% from 90% in Q1, Uniqlo renovations at Plaza Arcade completing soon with opening expected in Q3, plenty to look forward to.
  5. Visa, Alphabet, Bank of America, Facebook – Simply put, decent to stellar quarters.

Here’s to an awesome August. 🙂

Happy Hunting,
KK

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