Does City Developments Limited Look Like a Good Stock to Invest in?
This is probably the best time to travel! Countries in the Northern Hemisphere are enjoying spring while countries in the Southern Hemisphere are enjoying the cool weather that autumn brings.
Besides, many travel restrictions have been lifted, giving the tourism sector a much needed relief.
Where do you stay at when you’re on holiday? Where do you visit to satisfy your shopping desires?
Yes! You stay in rented properties (unless you have a holiday home) and visit malls for your shopping needs.
This brings me to the City Developments Limited (SGX: C09).
Brief History of City Developments Limited
Source: City Developments Limited’s LinkedIn
Founded in 1963, City Developments Limited went public on the Malayan Stock Exchange later that same year.
It’s first housing project was in Johor Bahru and pioneered the concept of show flats in 1965.
City Developments Limited success in the residential market caught the eye of the Hong Leong Group. The Hong Leong Group bought a controlling interest in City Developments Limited and expansionary plans were set into motion.
A diversification policy meant that City Developments Limited ventured into commercial and hospitality real estate, with household names such as Republic Plaza and Millennium & Copthorne Hotels.
City Developments Limited had transformed into a global player in the real estate industry with a presence in Australia, China, France, Italy, Maldives, Saudi Arabia, Turkey, UK, US, and more!
Though this makes a for a classic business success story, does City Developments Limited (SGX: C09) look like a good stock to invest in?
Concerned about the rising cost of living? This is one sector you’ll want to have in your portfolio.
Business Model and Financials
How has COVID-19, the entrance of Airbnb, and the rise of e-commerce affected City Developments Limited?
Source: Tradingview; Currency is quoted in S$
Through 2015 to 2018, the total revenue and net income of City Developments Limited were steady or climbing.
In 2019, City Developments Limited’s revenue dropped, but its net income maintained. That’s a relief.
When COVID-19 struck in early 2020, its impact on City Developments Limited was huge. City Developments Limited’s total revenue declined by about 30% while its net income plummeted.
A year later, the future looks rosy for City Developments Limited. Many countries around the world have eased their COVID-19 restrictions by welcoming travelers. This gave City Developments Limited a boost in its total revenue and net income.
Besides owning more than 200 properties and 3.3m square feet of land area, City Developments Limited practices active asset management. This allows the preservation and value creation of their assets, bringing in more returns to the company and its shareholders.
City Developments Limited has also been building up its fund management business, further diversifying its business. It has an aggressive goal of being the leading fund manager in Asia by 2023, achieving USD5b assets under management (AUM).
Do you think that City Developments Limited is able to achieve this goal?
Understanding the business model and financials of City Developments Limited, let’s proceed to determine if it’s a good time to buy shares of City Developments Limited now.
Technical Analysis on City Developments Limited (SGX: C09)
After the share price of City Developments Limited has been ranging for 8 months (Aug 21 to Mar 22), an uptrend is finally born!
Personally, I love it when the share price of a stock is trending as it’s much easier to profit from price trends.
And this is a fresh uptrend, indicating that there could be a long way more to go before this uptrend fades out. This is confirmed by the green arrow under the latest candlestick.
Next. let’s have a look at the Trend Impulse Factor. It has turned dark green, confirming the bullish momentum. The bulls are out to play!
Is City Developments Limited (SGX: C09) therefore a good stock to invest in? I would say that City Developments Limited (SGX: C09) is ripe for a position trade which can turn into an investment as long as its share price continues to trend higher.
Conclusion: City Developments Limited Should You Buy Or Sell?
City Developments Limited has a beautiful story to tell. An even more exciting story lies ahead.
Numbers don’t lie. City Developments Limited’s financials and price chart are encouraging. As more countries continue to open up, City Developments Limited is poised for further growth.
Against this backdrop, City Developments Limited looks like a good stock for a position trade and to invest in.
What are your thoughts? Share your thoughts with us below!
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