Hi ya'll, just wanted to bring to your attention an organization named FKP = Property Trust (ASX:FKP), which is currently trading at a discount of 62% o= f its FTA. In other words, the cost per share is $0.48, though its actual v= alue (Net Tangible Asset, NTA) is $1.25. This means that if you invested $1= 0,000, you have actually purchased $26,042 worth of property. This is even = better than investing in the property market! Investing in arbitrage is the= method of Warren Buffet, and is the only method that HONESTLY works. In my= experience, day traders (aka gamblers) only talk about their wins, and hid= e their losses.
Of particular importance is Stockland (which owns 14% of FKP Property Trust=
) is likely going to acquire the organization (it is already part way throu=
gh a share acquisition). This is inline with Stockland's strategy to expand=
into retirement villages. Stockland started buying FKP shares at $2 a shar=
e, though it is currently trading at $0.47. Trading at a value so low below=
NTA backing, makes it a sitting duck for takeover. As everybody knows, an =
acquisition means the company buys ALL shares at a premium (say 20% of the =
current price) meaning you will make a definite gain on FKP shareholdings.
As for the wider A-REIT sector, the return in 2011 was +10% as supposed to =
-9.7% for equities. This is not surprising, given - you ever heard your mot=
her tell you, invest in property, instead of being greedy and investing in =
the share market (where you can lose a lot), or gold (which isn't worth any=
thing and is just waiting for a bubble crash)? Even if the country goes int=
o war, the land on which property is sitting on is still worth something. C=
ontrast this with businesses which close, etc etc. Trust me, don't waste ti=
me with mining, retail sector, health care, etc.. if you're new to investin=
g, you're lucky you didn't lose 90% of your money (children's savings) in t=
he 2008 market crash..
The organization itself is performing extremely well. Profit increased from=
$77m in 2009, to $109m in 2010, and now 11% to $121m in 2011. Dividend dis=
tribution was doubled from 1.5c to 3c, gearing (debt level) has been reduce=
d to 29% since 2009 (and has been consistent for 2010 and 2011). If you loo=
k at Announcements, you also notice the Chairman (Seng Huang Lee) who is ov=
er the months acquiring more and more FKP shares. To me though, the most im=
portant is consensus recommendation (since often, fund managers have access=
to "inside" information that we the "public" may not have access to) which=
is 100% STRONG BUY (inc. Austock Securities, JP Morgan and Morningstar).
PS: I should note I (the author of this post) own holdings in FKP Property =
Group. Yeah, I put my money where my mouth is (unlike a lot of journos who =
just talk - but no action).
- posted 8 years ago