Since my last coverage on 28 March 2018, OUE share price had a devastating spell of run. Share price nose-dived from $1.80 to a shocking low of $1.37. After being walloped left, right, centre, OUE share is currently trading at a stunning 14-year low. Even during the dark days of The Great Financial Crisis, OUE share price had never crashed to such abysmal level. What could have happened?
A quick look at OUE shares revealed that the average 3-month volume stood at a mere 0.33mm. This means that OUE shares are thinly traded and may present some form of liquidity issue for long-term investors. In addition, despite having a market capitalization of $1.23 billion, this counter is seldom heavily shorted over the past three months. This means that even the big boys cannot be bothered with this real estate giant. Is OUE a value trap for retail investors?
Troubles come in troops
In all respect, 2018 has proven to be a mighty difficult year for most real estate developers in Singapore. The increase of Additional Buyer Stamp Duty (ABSD) to 12% and the tightening of loan limits had dampened demand for investment properties. Of course, the unexpected cooling measures …