Asked on 05 Sep 2019
For example, Ascott REIT is trading at a 0.75 PB at the moment. What is the logic behind that?
REITs can trade below PB for a number of reasons such as cyclical industry, poor management, bad future outlook, economic conditions etc.
Ascott is part of the hospitality industry. Perhaps, the tourism industry is experiencing a downturn. Generally, the hospitality industry is a cyclical industry because there are periods of high tourism and low tourism numbers.
05 Sep 2019