Thursday, September 27, 2018

CapitaLand Bouncing Back On Renewed Asset Recycling

I’ve lamented in the past that no matter what CapitaLand (OTCPK:CLLDY) (CATL.SI) does, the shares seem stuck between S$3 and S$4. When I last wrote about the shares, they were on their way down to retest that S$3 level and have since rebounded on good second quarter earnings, the naming of a new CEO, and ongoing steps to recycle capital into new investments, including a meaningful move into the U.S. market.

CapitaLand remains a challenging stock. The liquidity for the ADRs isn’t great (the Singapore-listed shares are far more liquid), and this is a tough stock for many investors to evaluate and model. On the other hand, CapitaLand has proven itself to be a quality developer and manager of properties in Asia with the ability to earn above its cost of capital. That is not presently reflected in the share price, and I believe there is still worthwhile upside from these levels.

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CapitaLand Bouncing Back On Renewed Asset Recycling

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