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ARA Asset Management and $1.78 a share.

Posted by A Singaporean Stockmarket Investor (ASSI) | Mar 5, 2017 | Shares & Derivatives | 0 | After my ARA “fixed deposit” has been redeemed, what remains is my original investment which I paid $1.00 to $1.32 a share for.

Although the offer of $1.78 would mean a 35% to 78% capital gain, I would be losing a very consistent and meaningful source of passive income. A yearly 5c dividend per share (DPS) gives me a yield on cost of 3.78% to 5% and from a growing business with a very strong balance sheet too.

At $1.78 a share, a 5c DPS gives a dividend yield of 2.8% which is still pretty decent considering the fact that ARA pay out only about half of their earnings as dividends.

As an investor for income, naturally, I would like to continue receiving dividends from companies such as ARA. With an impressive full year 2016 performance, I am even more reluctant to let go of my investment in ARA now…



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