Fears of Aggressive Rate Hikes

Best REITs to Buy in May 2024

Dividend Yield

Which are the best REITs to buy in May 2024? Which REIT gives you the highest current dividend yield? What are the REITs to buy in Singapore? Last week, the Federal Reserve announced that it has decided to leave its key interest rate unchanged at between 5.25% and 5.5%. The reason was because inflation rates continue to stall and there was a lack of progress in terms of bringing the inflation rate under control.

As you can see from the chart below (data from the U.S Bureau of Labor Statistics), the inflation rate in US accelerated for a second straight month to 3.5% in March 2024 from 3.2% in February 2024.

Inflation Rate US March 2024

When interest rates remain high, REITs will need to bear the higher financial costs. Higher financial costs will continue to erode the distributable income. In summary, lower Distribution Per Unit (DPU) is expected.

REIT Crisis or Opportunity?

While some investors view this as a crisis and start selling off their holdings, I view this as an opportunity for me to continue accumulating dividend yielding REITs to grow my passive income.

When share prices of REITs decreases, the current dividend yield increases.

Do you know how to calculate the current dividend yield? The formula for calculating the current dividend yield is straightforward. It is calculated by dividing the annual dividends per share by the current market price per share. Here is the formula in mathematical terms:

Current Dividend Yield

The current dividend yield is a ratio that indicates how much a company pays out in dividends each year relative to its stock price. It is a useful metric for investors to assess the return on investment from dividends alone, without considering any potential capital gains or losses from stock price movements.

However, a higher dividend yield does not always mean that it is a better investment. We should always consider the overall financial health and growth prospects of the REIT when evaluating dividend yields.

One of the ways that I personally use to obtain the current dividend yield of all the REITs when the stock market crash is to run a stock screener to get the results.

How to Find REITs to Buy in Singapore?

There are many stock screening tools out there. As such, it is not difficult to obtain a shorter list of good REITs and their current dividend yield for further analyse and decision making. Stock Screening tools allow you to screen REITs based on specific factors like P/E ratio, dividend yield, and other financial metrics.

StocksCafe Stock Screener

For me, I use Stocks Café Stock Screener to screen for a list of REITs that meet my predefined criteria so that I have a shorter list of REITs to analyse. Below are the criteria that I used to screen for dividend stocks. You can adjust them to fit your risk appetite.

  • Market Capitalization >= 1B
  • Current Yield (%) >= 5 and <= 10
  • Price / Book <= 3

Reminder: It is important for you to know that you should not buy the stock solely based on the current dividend yield. The screening results quickly gives you a glimpse of the current dividend yields of the REITs that meet the above screen criteria.

Best REITs to Buy in May 2024

Below is the list of REITs with the highest current dividend yield to the lowest current dividend yield.

CapitaLand China Trust (SGX:AU8U)
Market Capitalization: SGD 1.1B
Current Dividend Yield: 9.84%
Price to Equity: 30.89
Price to Book: 0.541
Net Asset Value (NAV): SGD 1.267
Closing Price (7-May-24): SGD 0.68

OUE REIT (SGX:TS0U)
Market Capitalization: SGD 1.5B
Current Dividend Yield: 7.89%
Price to Equity: 7.346
Price to Book: 0.439
Net Asset Value (NAV): SGD 0.604
Closing Price (7-May-24): SGD 0.265

Lendlease Reit (SGX:JYEU)
Market Capitalization: SGD 1.3B
Current Dividend Yield: 7.89%
Price to Equity: 17.991
Price to Book: 0.585
Net Asset Value (NAV): SGD 0.94
Closing Price (7-May-24): SGD 0.55

Starhill Global Reit (SGX:P40U)
Market Capitalization: SGD 1.1B
Current Dividend Yield: 7.83%
Price to Equity: 40.92
Price to Book: 0.627
Net Asset Value (NAV): SGD 0.766
Closing Price (7-May-24): SGD 0.475

AIMS APAC Reit (SGX:O5RU)
Market Capitalization: SGD 1B
Current Dividend Yield: 7.59%
Price to Equity: 14.118
Price to Book: 0.701
Net Asset Value (NAV): SGD 1.811
Closing Price (7-May-24): SGD 1.27

ESR-LOGOS REIT (SGX:J91U)
Market Capitalization: SGD 2.2B
Current Dividend Yield: 7.42%
Price to Equity: 27.652
Price to Book: 0.758
Net Asset Value (NAV): SGD 0.376
Closing Price (7-May-24): SGD 0.285

CapitaLand Ascott Trust (SGX:HMN)
Market Capitalization: SGD 3.4B
Current Dividend Yield: 7.30%
Price to Equity: 15.554
Price to Book: 0.713
Net Asset Value (NAV): SGD 1.263
Closing Price (7-May-24): SGD 0.9

Mapletree PanAsia Commercial Trust (SGX:N2IU)
Market Capitalization: SGD 6.5B
Current Dividend Yield: 7.19%
Price to Equity: 18.374
Price to Book: 0.698
Net Asset Value (NAV): SGD 1.777
Closing Price (7-May-24): SGD 1.24

Keppel Reit (SGX:K71U)
Market Capitalization: SGD 3.3B
Current Dividend Yield: 6.67%
Price to Equity: 19.521
Price to Book: 0.62
Net Asset Value (NAV): SGD 1.403
Closing Price (7-May-24): SGD 0.865

Far East Hospitality Trust (SGX:Q5T)
Market Capitalization: SGD 1.2B
Current Dividend Yield: 6.65%
Price to Equity: 9.452
Price to Book: 0.66
Net Asset Value (NAV): SGD 0.932
Closing Price (7-May-24): SGD 0.615

Suntec Reit (SGX:T82U)
Market Capitalization: SGD 3.1B
Current Dividend Yield: 6.34%
Price to Equity: 18.424
Price to Book: 0.489
Net Asset Value (NAV): SGD 2.228
Closing Price (7-May-24): SGD 1.07

Mapletree Logistics Trust (SGX:M44U)
Market Capitalization: SGD 6.7B
Current Dividend Yield: 6.31%
Price to Equity: 13.028
Price to Book: 0.919
Net Asset Value (NAV): SGD 1.512
Closing Price (7-May-24): SGD 1.36

Mapletree Industrial Trust (SGX:ME8U)
Market Capitalization: SGD 6.2B
Current Dividend Yield: 6.10%
Price to Equity: 22.965
Price to Book: 1.126
Net Asset Value (NAV): SGD 1.953
Closing Price (7-May-24): SGD 2.19

PARAGON REIT (SGX:SK6U)
Market Capitalization: SGD 2.4B
Current Dividend Yield: 5.98%
Price to Equity: 17.5
Price to Book: 0.827
Net Asset Value (NAV): SGD 1.016
Closing Price (7-May-24): SGD 0.85

CapitaLand Ascendas REIT (SGX:A17U)
Market Capitalization: SGD 11.6B
Current Dividend Yield: 5.85%
Price to Equity: 67.144
Price to Book: 1.113
Net Asset Value (NAV): SGD 2.326
Closing Price (7-May-24): SGD 2.58

CDL Hospitality Trust (SGX:J85)
Market Capitalization: SGD 1.2B
Current Dividend Yield: 5.76%
Price to Equity: 9.909
Price to Book: 0.65
Net Asset Value (NAV): SGD 1.508
Closing Price (7-May-24): SGD 0.98

Frasers Centrepoint Trust (SGX:J69U)
Market Capitalization: SGD 3.8B
Current Dividend Yield: 5.63%
Price to Equity: 20.895
Price to Book: 0.941
Net Asset Value (NAV): SGD 2.273
Closing Price (7-May-24): SGD 2.12

CapitaLand Integrated Commercial Trust (SGX:C38U)
Market Capitalization: SGD 13B
Current Dividend Yield: 5.57%
Price to Equity: 14.897
Price to Book: 0.905
Net Asset Value (NAV): SGD 2.133
Closing Price (7-May-24): SGD 1.92

Keppel DC Reit (SGX:AJBU)
Market Capitalization: SGD 2.9B
Current Dividend Yield: 5.42%
Price to Equity: 25.125
Price to Book: 1.289
Net Asset Value (NAV): SGD 1.342
Closing Price (7-May-24): SGD 1.74

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