Friday, September 6, 2013

Recent Action - CDL Hospitality Trusts

Hospitality sectors have been under huge pressure from the markets in recent months and it is easy to see that from the graphs. On YTD, the shares for CDL Hospitality Trusts have fallen from a 52 week high of $2.12 to today's 52 week low of $1.50. I managed to load them today at $1.505.

I think the selling in recent months has been quite overdone. We understand that fwd earnings are expected to be lower, but I personally don't expect it to drop a lot. I think EPS will remain slightly lower at $0.11 cents compared to $0.12 last year but it certainly does not justify the huge drop in its price. 

At $1.505, it currently yields on 7.3% forward earnings. I think that's a pretty nice cyclical play on the hospitality sector, not to mention that the Singapore government is focusing strongly on tourism. This sector would be a nice play on rebounds for sure once it happens. For the moment, I'll sit back, collect the dividends and accumulate on further weakness.

What do you think of the hospitality sector? Has the selling been overdone in recent months?


  1. don't buy trust... buy the stock...

    1. Hi Steven

      Not sure what you mean by that.

      Hospitality stocks in singapore are mostly packaged into stapled half reits and half trusts.

    2. i reckon it to be as follows :-

      stock : CITYDEV (C09)

      trust : CDL HTrust (J85)

  2. Agree, its been oversold. time for action

    1. Hi HM Shak

      Hope our action is the right one ;)