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No it's not. Firstly it's not a REIT, secondly it's as reliant on construction as it is on rental income, and finally, it doesn't just have student accomodation.
Bear - nice post, I agree with much of that, but more positive on Empiric here (which I started buying at 80p).
Worth a look WJG. Same sector, nice family run company.
Matt
Today I have sold over half my Digs shares its been a good run since buying at just over 107p but feel they are now toppy, trading well above NAV, with Divi of 3%
I already own 3 x more Empiric (at 108) so not adding there as excluding divs still sitting on a capital loss, a poor investment compared to Digs but thankfully the 5% div over the years means not an overall loss/washout.
Medium term ESP may have more upside than DIGS, as trading below NAV, 5% div , new management has turned it round and bringing letting in house through Hello Student has cut costs dramatically, though they still need to improve occupation levels to nearer 100% from 92%, further improve profits and get dividend fully covered for the SP to climb much further. Bear
Just below £2, now looking pricey. I'm going to switch some into Empiric. Also 100% student housing, slightly riskier, with worse balance sheet, but trades at a discount to NAV and yields over 5%. Anyone else?
Really thanks for that. You confirmed my take too.
But you done real well - its been on a great run and that is probably how I found it by chance. But I think that I am too late for this run and as with other REITs I would not be surprised to see a big pull back shortly.
Cheers
Since my previous post I sold out and invested elsewhere. The share price has done really well but the dividends haven't followed as yet. I try to keep the total yield on my portfolio of quarterly dividend payers above 5.2%. Buying back into DIGS at the moment would produce a yield of under 4 percent, so I am hanging back until something changes. It does worry me when I travel to cities and see massive tower blocks going up. You look what they are going to be and it is always "luxury" student apartments. Bournemouth, Brighton, Sheffield. I am not sure how long this can go on. It's a bit different to the ten students in a terraced house of a few years ago.
I like the looks of DIGS. I was close to buying earlier. But I noticed the high price markup in relation to the NAV. What are your thoughts? Could there be an asset bubble in the making here...