Good at least you now do not accuse WeeHur profits of being "phantom" and in your comparison acknowledge that there will be recurring income which is from August 2014.
Yes in the even longer term, >5years, 6 cents can be expected to come in for CES. However I do not see a 6 cent div yet. Until management pays that out instead of splashing on SBBs, I would not expect any sudden movement of price to $1.20 (corresponding 5% yield with 6 cents) Singaporean investors are pretty "yield hungry"
CES is after all still GEARED and not NET CASH. Perhaps next year it will get closer to $1.60.
31-08-2014, 02:20 PM (This post was last modified: 31-08-2014, 06:37 PM by Curiousparty.)
With the completion of A&A works at San Centre by end of 2014 and the commissioning of Alexandra Park Hotel in mid-2015, the recurring income from investment properties will be strongly boosted.
The preliminary estimate is as follows:-
Park Hotel
When hotel TOPs in mid-2015, it will be passed over to Park Royal Group for management.
$100 (per room per day) x 450 (capacity) x 365 days x 0.83 (tax rate) = $13.6 mil (net income per year)
Refurbished San Centre (grade B office; 10 storeys out of 12 storeys to be rent out)
Rental income = 84,000 sq Ft (NLA) x $6 PSF per mth x 12 mths x 0.83 (tax rate) = $5.0 mil (net income per year)
(basis - Pls see attached document)
420 St Kilda Rd - Office Building in CBD Melbourne
Rental income = 8% (rental yield) x A$45.3 mil x 1.2 (exchange rate) x 0.83 = $3.6 mil (net income per year)
Total rental income from above 3 investment properties = $22.2 mil per year or 3.5 cents EPS.
The above rental income from investment properties coupled with the existing 3 cents EPS from construction arm (per year) , it should not be a tall order for the company to increase the regular dividend from the current 4 cents to 6 cents going forward.
Recurring income will stabilize the share price at a higher level, say $1.20 (dividend yield of 6 cents or 5% yield).
Although at $1.20, it is still trading at 25% discount to RNAV of ~$1.60 (excluding Fulcrum, Fernvale and all other overseas projects)
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(31-08-2014, 12:23 AM)BlueKelah Wrote: Let me clarify why CES is trading as such a discount to its RNAV as CP has calculated.
CP you gotta seriously look at the reasons for CES undervalued instead of repeating 'ad nauseam' everyday that this stock is undervalued and should be worth more.
Altot CES is one of my favorite stock and i vested a lot since long time but I do agreed with you that someone keep promoting ad nauseam at VB and nextinsight really make me feel uncomfortable. Anyway, i get used to it and just skip those post I feel non-constructive and repeating post.
(31-08-2014, 12:23 AM)BlueKelah Wrote: Let me clarify why CES is trading as such a discount to its RNAV as CP has calculated.
CP you gotta seriously look at the reasons for CES undervalued instead of repeating 'ad nauseam' everyday that this stock is undervalued and should be worth more.
Altot CES is one of my favorite stock and i vested a lot since long time but I do agreed with you that someone keep promoting ad nauseam at VB and nextinsight really make me feel uncomfortable. Anyway, i get used to it and just skip those post I feel non-constructive and repeating post.
(01-09-2014, 08:42 PM)value seeker Wrote: Another 1.7 mil shares purchased by company. Will be interested to find out their plans for the increasing number of treasury shares.
vested.
Another 1.5 mil shares purchased by company at about 90 cents. Company has been super agressive.
If the company is looking at a NAV of ~$1.10 by year end with low risk (given TOP is imminent) then it makes a lot of sense for them to be buying at 90c. I suspect the cash is starting to come in from Belvia and the company is using that to i) degear and ii) seeing that their best investment return at the moment is in their own stock, rather than saving for future property investments.
Through the buyback the company has already returned over 1c per share to the market. I know investors are obsessed with dividends and special payouts but I'm just as happy to see a company prudently deploying capital though accretive buybacks as paying out special dividends to shareholders.
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