Dane Bowler
Value, hedge fund analyst, REITs, long/short equity

Strong Fundamentals And Deep Value Make Associated Estates A Buy

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 (NYSE:AEC). It is well-positioned to outperform the market as it has the following factors in its favor.

  1. Encouraging industry fundamentals
  2. Extreme value
  3. 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 live...

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