Capitaland Retail China (CRC) at the current price is now my latest target.
This conclusion is based on my evaluation of the current yield of selected Reits relative to the last 3-5 years historical yield performance. See chart below.
In my “similar” post last month, I mentioned I was attracted to Starhill Global Reit (SGR) at 66.5 cents but watching CRC and SPH Reit. Since then, the share price of SGR has risen to 69.5 cents. Consequently, it’s relative position on the yield spectrum has dropped to 58% compared to 70+% last month. See chart below. I am less interested to accumulate more now.
Instead my interest has now switched to CRC whose relative position has increased to 82% compared to 50% last month. This is because its share price has dropped from $1.51 to $1.44 recently but Dividend per share has remained almost constant.
I am still watching SPH Reit and SGR as they are still above 50%. I may accumulate more if they experience weakness in share price.
SPH Reit has been very resilient and the yield spectrum is the narrowest, just 0.9% yield spread between the highest and lowest yields. This give a greater predictability to the level of yield you can expect, thus lowering risk to a dividend yield investor. Hence, it is a good addition to our portfolio.
Next, I am also watching Soilbuild Business Reit (SBR), its at 46% of the spectrum. Any further weakness will trigger my interest. But for SBR, I will want to demand a greater safety margin.
I plan to update and analyse this monthly to guide my choice of Reit to accumulate.
Let’s see how things pan out next month … Starhill Global Reit has been good in the last one month 🙂