The Ascott’s brand of luxury serviced apartments is the domain of a certain kind of business traveller, one with a nice corner office in at a prestigious address. Ascott Trust is a real estate investment trust (or REIT) that was set up by the Ascott Limited in order to allow investment in a basket of their properties.
But now that Covid-19 has put the brakes on travel for business or otherwise, what will happen to Ascott Trust stocks? Keep reading to learn more.
Disclaimer: This article contains information on the Ascott Trust share prices as well as the company’s recent performance trends. It is meant as a guide for readers only, not financial advice. Please practise your own discretion when making investment decisions.
Ascott Trust (HMN) overview
|Sector||Real estate specialised REITs|
|Year of incorporation||2005|
|Total Market Cap||$2,719.17 million|
|Historical share price||Consistently above $1.20 until Covid-19 sent price plunging to a low of $0.67|
|Current share price||$0.87|
|Current dividend yield||8.138%|
|Dividend yield 5-year average||6.237%|
Note: The figures are accurate at the time of writing (Apr 2020), but due to the nature of this industry, this information changes very frequently. For the latest updates, do check Ascott Trust’s (HMN) SGX listing.
Ascott Trust (HMN) stock profile: Share prices, dividends and more
Ascott Trust has a market capitalisation of about $2.72 billion, has about 4,000 employees and is found on several indices including FTSE ST Mid Cap Index, FTSE ST Real Estate Index and FTSE ST REIT Index.
By buying Ascott Trust stocks, you are also getting exposure to Scott REIT and Ascott Business Trust stocks.
Over the long term, Ascott Trust has actually done very well, with its asset size ballooning by four times since it was listed in 2006. 2020 started out stably for Ascott Trust, with prices hovering between $1.36 to $1.22.
When the Covid-19 epidemic hit, share prices plunged to a low of about $0.67 in March, and are currently still less than $0.90.
At the time of writing, the dividend yield for Ascott Trust stocks is a very high 8.138%. So, it’s no surprise that this company has been a hit with dividend investors.
However, their dividends have a history of being unstable, and to make matters worse they have been paying out a relatively high percentage of their earnings, which makes them less able to absorb shocks.
Given the huge fall in revenue brought about by Covid-19, dividends run the risk of being cut drastically.
Read also: REITs in Singapore — MoneySmart Guide to Investing in REITs
About Ascott Trust (HMN): Market news and updates
Ascott Trust was first incorporated in 2005 and is an SGX-listed REIT which enables you to invest in an asset portfolio containing 39 properties in 15 countries including Singapore, China, Japan, the UK and the US. Most of them are either operated as serviced apartments or rental properties, including Ascott Orchard and Park Hotel Clarke Quay.
Ascott Trust’s biggest shareholder by far is Temasek Holdings, Singapore’s sovereign wealth fund, with a 40.6289% share. The Ascott Limited, the company actually operating the Ascott’s properties, is owned by CapitaLand.
- Min. Commission Fee for US Stocks
- Min. Commission Fee for SG Stocks
- Min. Funding
With its reliance on luxury and business travellers, Ascott Trust is particularly vulnerable to the travel restrictions, poor business climate and decision of companies to switch to remote working that have arisen due to COVID-19.
In addition, despite their generous dividends to date, this unprecedented fall in revenue is certain to have an impact on their payouts.
What is more, the possibility that Covid-19 could have long-lasting effects on tourism and business travel even after the epidemic is over makes this stock’s future look even more uncertain.
We say: tread carefully.
Do you have any stock investment tips to share? Leave them in the comments!
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