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Top 3 Tradeable Ideas For The Week
Tradeable, Tradeable Ideas | 30 July 2014
Related stocks:
LJ3
By: Tradeable
Articles (256)

Both the Singapore and US markets seem to have diverged in terms of direction this past week. While the STI has traded higher, major US indices seemed to have taken a slight correction.

In times like these, don’t you wish you had some ideas of what to trade? We present the top three trading ideas (according to page views) and present our thoughts about them below.

1. Disciplined, Cost-Conscious Management Makes CMT A Good Retail REIT Buy

  1. CMT announced increased DPU of 6.3 percent for 2Q14 and 5.4 percent for 1H14.
  2. Ongoing AEIs at several properties seem to be progressing well and could provide some downside support.
  3. CMT recently announced that it would be conducting an AEI for Bukit Panjang Plaza. MBKE continues to like CMT for its disciplined and cost-conscious management.

Read More>>

What we think: A landlord can only charge as much rental as the tenant can afford. Hence, the relationship between the two suffers if sales by tenants fall. This is exactly what is happening to CapitaMall Trust’s tenants. According to their 1H14 results slides, both shopper traffic as well as tenant sales per square foot decreased. This does not bode well for the trust if it wants to revise rentals upwards.

Source: CapitaMall Trust, shopper traffic for 1H14

Source: CapitaMall Trust, portfolio tenants' sales for 1H14

Coupled with a possible hike in interest rates causing financing costs to increase, we feel that CaptaMall Trust could be hard pressed to maintain its growth if shoppers start to stay away from its retail properties.

2. Outlook For Mapletree Commercial Trust Remains Positive

  1. Mapletree Commercial Trust announced improved financial performance recently.
  2. With limited supply of commercial properties over the next two years, the trust could experience more positive rental reversions
  3. The trust’s retail and office properties expected to remain fairly resilient moving forward.

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What we think: Mapletree Commercial Trust’s share price has surged ahead recently and optimism about its financial results could already be priced in. At this juncture, even dividend-focused investors might find it expensive with a dividend yield of about 4.6 percent versus its historical yield of about 5.5 percent. Still, at 4.6 percent, it is a decent dividend play.

3. Long OUE at Trendline Support

  1. OUE has seen a bottom of $2.20 in April 2014. The stock could now be headed for a uptrend after being stuck in a bearish trend.
  2. 20,40 and 100 moving averages are all turning upwards.
  3. Lows are consolidating at a higher price of $2.40.

Read More>>

What we think: Investors and traders might want to note that OUE has an average target price of about $2.75. This is the average taken from three Buy calls from analysts at Maybank Kim Eng (TP: $2.80), Phillip Securities (TP: $2.59), and OCBC Securities (TP: $2.87).

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CapitaLand Mall Trust  2.620 -0.03 -1.13%   
Business: Co owns and invests in quality income-producing assets which are used, or predominantly used, for retail purposes primarily in Singapore.

Insight: Apr-19, 1Q19 gross revenue and NPI rose 10% and 11... Read More
Mapletree Commercial Trust  2.060 +0.01 +0.49%   
Business: Invest in income producing real estate used for office & retail purposes.

Insight: Apr-19, FY19 revenue inched up 2.4% due to higher ... Read More
OUE  1.480 +0.010 +0.68%   
Business: An integrated property developer with real estate portfolio located in prime locations in the US & Asia. [FY18 Turnover] Inv ppties (43.7%), hospitality (37.7%), development ppties (10.5%), healthcare (4.6%), fund management & others (3.5%).

Insight: May-19, 1Q19 revenue rose 1.2% due to higher contr... Read More


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The Shares Investment editorial team welcomes constructive feedback on our coverage and content. We would also be delighted to answer any questions on the above article. Leave us a comment below, and we'll get back to you shortly!

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