SGX:AW9U

Stock Analysis Report

First Real Estate Investment Trust

Executive Summary

First Real Estate Investment Trust (“First REIT”) is a real estate investment trust constituted by the Trust Deed entered into on 19 October 2006 between Bowsprit Capital Corporation Limited as the Manager and HSBC Institutional Trust Services (Singapore) Limited as the Trustee.

Rewards

Trading at 54.2% below its fair value

Earnings are forecast to grow 9.19% per year

Pays a high and reliable dividend of 11.54%

Risk Analysis

Has a high level of debt

Dividend of 11.54% is not well covered by earnings

Highly volatile share price over past 3 months

Profit margins (39.5%) are lower than last year (62.4%)



Snowflake Analysis

Established dividend payer with mediocre balance sheet.


Similar Companies

Share Price & News

How has First Real Estate Investment Trust's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: AW9U's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

9.6%

AW9U

5.7%

SG REITs

5.0%

SG Market


1 Year Return

-25.1%

AW9U

-15.7%

SG REITs

-23.6%

SG Market

Return vs Industry: AW9U underperformed the SG REITs industry which returned -17.5% over the past year.

Return vs Market: AW9U matched the SG Market which returned -24.7% over the past year.


Shareholder returns

AW9UIndustryMarket
7 Day9.6%5.7%5.0%
30 Day-19.9%-20.4%-10.8%
90 Day-25.5%-23.7%-22.0%
1 Year-18.5%-25.1%-10.7%-15.7%-20.4%-23.6%
3 Year-31.3%-44.8%12.2%-6.7%-14.8%-23.9%
5 Year-26.6%-48.1%20.3%-13.2%-15.4%-29.7%

Price Volatility Vs. Market

How volatile is First Real Estate Investment Trust's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is First Real Estate Investment Trust undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: AW9U (SGD0.75) is trading below our estimate of fair value (SGD1.63)

Significantly Below Fair Value: AW9U is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: AW9U is poor value based on its PE Ratio (13x) compared to the REITs industry average (10.1x).

PE vs Market: AW9U is poor value based on its PE Ratio (13x) compared to the SG market (10.5x).


Price to Earnings Growth Ratio

PEG Ratio: AW9U is poor value based on its PEG Ratio (1.4x)


Price to Book Ratio

PB vs Industry: AW9U is overvalued based on its PB Ratio (0.7x) compared to the SG REITs industry average (0.7x).


Next Steps

Future Growth

How is First Real Estate Investment Trust forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

9.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AW9U's forecast earnings growth (9.2% per year) is above the savings rate (1.8%).

Earnings vs Market: AW9U's earnings (9.2% per year) are forecast to grow faster than the SG market (4.7% per year).

High Growth Earnings: AW9U's earnings are forecast to grow, but not significantly.

Revenue vs Market: AW9U's revenue (0.7% per year) is forecast to grow slower than the SG market (3.9% per year).

High Growth Revenue: AW9U's revenue (0.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: AW9U's Return on Equity is forecast to be low in 3 years time (8%).


Next Steps

Past Performance

How has First Real Estate Investment Trust performed over the past 5 years?

-5.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: AW9U has high quality earnings.

Growing Profit Margin: AW9U's current net profit margins (39.5%) are lower than last year (62.4%).


Past Earnings Growth Analysis

Earnings Trend: AW9U's earnings have declined by -5.8% per year over the past 5 years.

Accelerating Growth: AW9U's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: AW9U had negative earnings growth (-37.2%) over the past year, making it difficult to compare to the REITs industry average (4.4%).


Return on Equity

High ROE: AW9U's Return on Equity (5.7%) is considered low.


Next Steps

Financial Health

How is First Real Estate Investment Trust's financial position?


Financial Position Analysis

Short Term Liabilities: AW9U's short term assets (SGD84.8M) exceed its short term liabilities (SGD44.1M).

Long Term Liabilities: AW9U's short term assets (SGD84.8M) do not cover its long term liabilities (SGD527.4M).


Debt to Equity History and Analysis

Debt Level: AW9U's debt to equity ratio (57%) is considered high.

Reducing Debt: AW9U's debt to equity ratio has increased from 53.2% to 57% over the past 5 years.

Debt Coverage: AW9U's debt is well covered by operating cash flow (20.5%).

Interest Coverage: AW9U's interest payments on its debt are well covered by EBIT (5.2x coverage).


Balance Sheet


Next Steps

Dividend

What is First Real Estate Investment Trust's current dividend yield, its reliability and sustainability?

11.54%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: AW9U's dividend (11.54%) is higher than the bottom 25% of dividend payers in the SG market (3.1%).

High Dividend: AW9U's dividend (11.54%) is in the top 25% of dividend payers in the SG market (6.84%)


Stability and Growth of Payments

Stable Dividend: AW9U's dividends per share have been stable in the past 10 years.

Growing Dividend: AW9U's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (71.6%), AW9U's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: AW9U's dividends in 3 years are not forecast to be well covered by earnings (103.8% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.2yrs

Average management tenure


CEO

Victor Tan (52yo)

2.92s

Tenure

Mr. Tan Kok Mian, also known as Victor, has been the Acting Chief Executive Officer & Executive Director - Bowsprit Capital Corporation Limited since 2017. Mr. Tan is a Chief Executive Officer of FIRST REI ...


Leadership Team

NamePositionTenureCompensationOwnership
Kok Mian Tan
CEO & Executive Director of Bowsprit Capital Corporation Limited2.92yrsno data0.013% SGD73.8k
Chwee Ngor Ng
Chief Financial Officer of Bowsprit Capital Corporation Limited2.17yrsno datano data
Seng Leong Chan
Head of Asset & Investment Management of Bowsprit Capital Corporation Limitedno datano datano data
Lay Hong Tan
Company Secretary0.67yrno datano data

2.2yrs

Average Tenure

Experienced Management: AW9U's management team is considered experienced (2.2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Kok Mian Tan
CEO & Executive Director of Bowsprit Capital Corporation Limited2.92yrsno data0.013% SGD73.8k
Christopher James Williams
Chairman of Bowsprit Capital Corporation Limited1.5yrsno datano data
Pengee Chan
Lead Independent Director of Bowsprit Capital Corporation Limited1.5yrsno datano data
Chuan Lye Tan
Independent Director of Bowsprit Capital Corporation Limited3yrsS$75.83kno data
Martin Lechner
Independent Director of Bowsprit Capital Corporation Limited2.25yrsno datano data
Charles Bye Ferris
Independent Director of Bowsprit Capital Corporation Limited1.5yrsno datano data
Minny Riady
Non-Independent Non-Executive Director of Bowsprit Capital Corporation Limited1yrno datano data

1.5yrs

Average Tenure

60yo

Average Age

Experienced Board: AW9U's board of directors are not considered experienced ( 1.5 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

First Real Estate Investment Trust's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: First Real Estate Investment Trust
  • Ticker: AW9U
  • Exchange: SGX
  • Founded: 2006
  • Industry: Health Care REITs
  • Sector: Real Estate
  • Market Cap: S$575.995m
  • Shares outstanding: 799.99m
  • Website: https://www.first-reit.com

Location

  • First Real Estate Investment Trust
  • 50 Collyer Quay
  • No. 06-01, OUE Bayfront
  • Singapore
  • 49321
  • Singapore

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
AW9USGX (Singapore Exchange)YesUnitsSGSGDDec 2006
F1TDB (Deutsche Boerse AG)YesUnitsDEEURDec 2006
FESN.FOTCPK (Pink Sheets LLC)YesUnitsUSUSDDec 2006

Biography

First Real Estate Investment Trust (“First REIT”) is a real estate investment trust constituted by the Trust Deed entered into on 19 October 2006 between Bowsprit Capital Corporation Limited as the Manager and HSBC Institutional Trust Services (Singapore) Limited as the Trustee. First REIT was listed on the Singapore Exchange Securities Trading Limited on 11 December 2006. On 1 March 2018, HSBC Institutional Trust Services (Singapore) Limited retired as the Trustee of First REIT in favour of Perpetual (Asia) Limited. First REIT is Singapore’s first healthcare real estate investment trust that aims to invest in a diversified portfolio of income-producing real estate and / or real estate-related assets in Asia that are primarily used for healthcare and / or healthcare-related purposes. Managed by Bowsprit Capital Corporation Limited, First REIT’s portfolio consists of twenty properties located in Indonesia, Singapore and South Korea, namely 1) Siloam Hospitals Lippo Village, 2) Siloam Hospitals Kebon Jeruk, 3) Siloam Hospitals Surabaya, 4) Imperial Aryaduta Hotel & Country Club, 5) Mochtar Riady Comprehensive Cancer Centre, 6) Siloam Hospitals Lippo Cikarang, 7) Siloam Hospitals Manado & Hotel Aryaduta Manado, 8) Siloam Hospitals Makassar, 9) Siloam Hospitals Bali, 10) Siloam Hospitals TB Simatupang, 11) Siloam Hospitals Purwakarta, 12) Siloam Sriwijaya, 13) Siloam Hospitals Kupang & Lippo Plaza Kupang, 14) Siloam Hospitals Labuan Bajo, 15) Siloam Hospitals Buton & Lippo Plaza Buton, 16) Siloam Hospitals Yogyakarta, 17) Pacific Healthcare Nursing Home @ Bukit Merah, 18) Pacific Healthcare Nursing Home II @ Bukit Panjang, 19) The Lentor Residence and 20) Sarang Hospital. Its hospital assets in Indonesia are operated by PT Siloam International Hospitals Tbk, a subsidiary of PT Lippo Karawaci Tbk, a strong brand name in the Indonesian healthcare industry supported by a team of international healthcare professionals whereas The Imperial Aryaduta Hotel & Country Club and Hotel Aryaduta Manado are operated by The Aryaduta Hotel and Resort Group. The Lippo Plaza Kupang and Lippo Plaza Buton are managed by PT Lippo Malls Indonesia. In Singapore, the nursing homes at Bukit Merah and Bukit Panjang are operated by Pacific Healthcare Nursing Home Pte. Ltd. and Pacific Eldercare and Nursing Pte. Ltd., respectively. The Lentor Residence is operated by The Lentor Residence Pte. Ltd. In South Korea, the Sarang Hospital is operated by a private doctor. Through First REIT, investors can participate in an asset class that has a focus towards Asia’s growing healthcare sector, which is boosted by an increase in life expectancy in Indonesia and the rest of Southeast Asia. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/09 13:06
End of Day Share Price2020/04/09 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.