OTCPK:PREU.F

Stock Analysis Report

Prosperity Real Estate Investment Trust

Executive Summary

Prosperity REIT [SEHK: 808] is a Hong Kong collective investment scheme authorized under section 104 of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong).


Snowflake Analysis

Established dividend payer and good value.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: PREU.F has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0%

PREU.F

15.1%

US REITs

9.4%

US Market


1 Year Return

n/a

PREU.F

-14.1%

US REITs

-6.8%

US Market

Return vs Industry: Insufficient data to determine how PREU.F performed against the US REITs industry.

Return vs Market: Insufficient data to determine how PREU.F performed against the US Market.


Shareholder returns

PREU.FIndustryMarket
7 Day0%15.1%9.4%
30 Dayn/a-12.2%-3.9%
90 Dayn/a-18.4%-16.5%
1 Yearn/a-10.5%-14.1%-4.8%-6.8%
3 Yearn/a6.0%-7.3%23.4%15.2%
5 Year-30.6%-30.6%26.3%0.5%41.3%25.7%

Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

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

15.5%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: PREU.F ($0.25) is trading below our estimate of fair value ($0.29)

Significantly Below Fair Value: PREU.F is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: PREU.F is good value based on its PE Ratio (10.8x) compared to the REITs industry average (23x).

PE vs Market: PREU.F is good value based on its PE Ratio (10.8x) compared to the US market (12.5x).


Price to Earnings Growth Ratio

PEG Ratio: PREU.F's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: PREU.F is good value based on its PB Ratio (0.4x) compared to the US REITs industry average (1.2x).


Next Steps

Future Growth

How is Prosperity Real Estate Investment Trust forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

-10.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PREU.F's earnings are forecast to decline over the next 3 years (-10.7% per year).

Earnings vs Market: PREU.F's earnings are forecast to decline over the next 3 years (-10.7% per year).

High Growth Earnings: PREU.F's earnings are forecast to decline over the next 3 years.

Revenue vs Market: PREU.F's revenue (3% per year) is forecast to grow slower than the US market (7% per year).

High Growth Revenue: PREU.F's revenue (3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: PREU.F's Return on Equity is forecast to be low in 3 years time (2.6%).


Next Steps

Past Performance

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

-4.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PREU.F has a large one-off gain of HK$128.1M impacting its December 31 2019 financial results.

Growing Profit Margin: PREU.F's current net profit margins (72.1%) are lower than last year .


Past Earnings Growth Analysis

Earnings Trend: PREU.F's earnings have declined by -4.9% per year over the past 5 years.

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

Earnings vs Industry: PREU.F had negative earnings growth (-51.6%) over the past year, making it difficult to compare to the REITs industry average (4.3%).


Return on Equity

High ROE: PREU.F's Return on Equity (3.9%) is considered low.


Next Steps

Financial Health

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


Financial Position Analysis

Short Term Liabilities: PREU.F's short term assets (HK$398.9M) exceed its short term liabilities (HK$385.6M).

Long Term Liabilities: PREU.F's short term assets (HK$398.9M) do not cover its long term liabilities (HK$2.5B).


Debt to Equity History and Analysis

Debt Level: PREU.F's debt to equity ratio (26.9%) is considered satisfactory.

Reducing Debt: PREU.F's debt to equity ratio has reduced from 42.1% to 26.9% over the past 5 years.

Debt Coverage: PREU.F's debt is not well covered by operating cash flow (13.9%).

Interest Coverage: PREU.F's interest payments on its debt are well covered by EBIT (5.5x coverage).


Balance Sheet


Next Steps

Dividend

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

7.68%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: PREU.F's dividend (7.62%) is higher than the bottom 25% of dividend payers in the US market (2.01%).

High Dividend: PREU.F's dividend (7.62%) is in the top 25% of dividend payers in the US market (5.66%)


Stability and Growth of Payments

Stable Dividend: PREU.F's dividend payments have been volatile in the past 10 years.

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


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (83.2%), PREU.F's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: PREU.F's dividends in 3 years are forecast to be thoroughly covered by earnings (0.04% payout ratio).


Next Steps

Management

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

12.1yrs

Average board tenure


CEO

Mavis Wong (46yo)

9s

Tenure

Ms. Lai Hung Wong, also known as Mavis, has been the Chief Executive Officer of ARA Asset Management (Prosperity) Limited, Manager of Prosperity REIT since January 1, 2013. Ms. Wong served as an Acting Chi ...


Board Members

NamePositionTenureCompensationOwnership
Lai Hung Wong
CEO & Executive Director of ARA Asset Management (Prosperity) Limited9yrsno datano data
Kwok Hung Chiu
Chairman of ARA Asset Management (Prosperity) Limitedno datano datano data
Sow-Mei Sng
Independent Non-Executive Director of ARA Asset Management (Prosperity) Limited15.58yrsno datano data
Hwee Chiang Lim
Non-Executive Director of ARA Asset Management (Prosperity) Limitedno datano datano data
Hong Tsung Lan
Independent Non-Executive Director of ARA Asset Management (Prosperity) Limited15.17yrsno data0.023% HK$107.4k
Lai Chee Ma
Non-Executive Director of ARA Asset Management (Prosperity) Limitedno datano datano data
Kwai Lam Wong
Independent Non-Executive Director of ARA Asset Management (Prosperity) Limited8.75yrsno datano data

12.1yrs

Average Tenure

68yo

Average Age

Experienced Board: PREU.F's board of directors are seasoned and experienced ( 12.1 years average tenure).


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

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


Key Information

  • Name: Prosperity Real Estate Investment Trust
  • Ticker: PREU.F
  • Exchange: OTCPK
  • Founded:
  • Industry: Office REITs
  • Sector: Real Estate
  • Market Cap: HK$3.587b
  • Listing Market Cap: HK$462.714m
  • Shares outstanding: 1.51b
  • Website: https://www.prosperityreit.com

Location

  • Prosperity Real Estate Investment Trust
  • Units 5508-09, The Center
  • 55th Floor
  • Central
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
808SEHK (The Stock Exchange of Hong Kong Ltd.)YesUNITSHKHKDDec 2005
PREU.FOTCPK (Pink Sheets LLC)YesUNITSUSUSDDec 2005

Biography

Prosperity REIT [SEHK: 808] is a Hong Kong collective investment scheme authorized under section 104 of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong). Prosperity REIT owns a diverse portfolio of seven high-quality properties in the decentralized business districts of Hong Kong, comprising all, or a portion of, three Grade A office buildings, one commercial building, two industrial/office buildings and one industrial building, with a total gross rentable area of about 1.28 million sq. ft. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/09 01:50
End of Day Share Price2020/03/25 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.