Investors of City Developments Limited (CDL) can be forgiven for punching the wall. From a high of $13.50 in March 2018, CDL share price collapsed to the current dismal level of $8.23. Out of nowhere, CDL share price suffered a devastating train wreck, causing many investors to lose their pants. What has gone wrong with this leading light of SGX?
As one of the biggest real estate developers in Singapore, CDL share price has withstood the test of time and has weathered numerous property cycles through the decades. This time, I am absolutely convinced it will be no different. With market capitalization of $7.6 billion, CDL is certainly one of the largest components among the prestigious Straits Times Index (STI). This means that CDL share price is extremely prone to fluctuations because short-sellers are likely to target the shares when Singapore property outlook turns sour. The 5-year beta of 1.125 vindicates CDL share price volatility. Of course, you can make money out of this stock but in my opinion, CDL share price remains an enigma to me.
If you look back, CDL share price went on a spell-binding bull run in 2017, surging from $8.30 in January 2017 to almost $13.00 in December 2017. With that sort of explosive run, it certainly seems that the sky is the limit for CDL share price. The magical run of CDL share price confounded many analysts because it came on the back of a declining financial results for FY2017, which saw net income decreased to $538 million versus $653 million recorded in FY2016.
But what goes up must surely come down. This is the universal law for investing. In this article, I will share my insights on CDL share price and provide a detailed analysis how major funds are influencing the CDL share price. I will also share my view on whether a recovery is in sight for this counter in the coming months.
Bombshell for CDL share price
Indeed, the meltdown of CDL share price in the past few months must be giving investors recurring nightmares. Needless to say, the turning point for CDL share price must be the new cooling measures announced on 5 July 2018. The latest measures knocked the wind out of CDL share price, causing it to plunge from an euphoric $11.20 on 4 July 2018 to $9.50 on 5 July 2018. Since then, CDL share price never looked back, continuing to roll off the cliff. What a wild ride it has been for investors!
The reason for the brutal decline of CDL share price is attributed to [This is a premium article. The rest of the content is blocked and can be accessible by SG Wealth Builder Members only. To read the full content, please sign up as member.]
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