Maintaining BUY on Ascott Residence Trust: Resilient Earnings, Stable Distributions, and Attractive Yield Support Favourable Risk-Reward

Phillip Securities analyst Darren Chan has maintained their bullish stance on ATTRF stock, giving a Buy rating yesterday.

Darren Chan has given his Buy rating due to a combination of factors related to Ascott Residence Trust’s resilient earnings profile and stable income outlook. He highlights that distributable income has grown despite currency headwinds, supported by stronger operating performance and active portfolio reshuffling, which in turn has allowed distributions to unitholders to edge higher. He also points to broad-based improvements in revenue per available unit across most key markets on a same-store basis, indicating healthy demand and room for further revenue growth in the coming year. In addition, Chan notes that management has guided for a stable distribution per unit in 2026, underpinned by divestment gains that can be used to cushion the impact of ongoing asset enhancement projects, with a sizable buffer of such gains still sitting on the balance sheet.

Chan’s positive stance is further reinforced by Ascott Residence Trust’s strong financial position and prudent capital management. The trust benefits from a largely fixed-rate debt structure that keeps borrowing costs predictable, while leverage has improved due to debt repayment funded by divestment proceeds, and interest coverage remains comfortable. He also emphasizes the trust’s diversified portfolio across geographies and its mix of stable and growth-oriented income streams, which together provide resilience through economic cycles. With expectations of low single-digit growth in revenue per available unit in 2026 and an attractive forward distribution yield implied by the current unit price, Chan concludes that the risk-reward profile justifies maintaining a Buy recommendation.

In another report released yesterday, TipRanks – DeepSeek also reiterated a Buy rating on the stock with a S$1.00 price target.