The Buy Thesis
It is very rare for an investment to appear favorable from every angle, but the events of the past two months have aligned the stars for Associated Estates (AEC). It is well-positioned to outperform the market as it has the following factors in its favor.
- Encouraging industry fundamentals
- Extreme value
- Superior internal performance
We will now explore each of these factors in greater detail.
Encouraging Industry Fundamentals
For multi-family REITs, there are essentially three components that govern their supply/demand balance: Net household formation, market share distribution and net new supply. I believe that over the next few years, each of these components will be favorable.
1. Net new household formation
While everyone has to...
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