Stephen Simpson, CFA
Long only, growth at reasonable price, value, research analyst

Forest City Enterprises Still Not Getting Full Credit For Its Transition

What Forest City Enterprises (NYSE:FCE.A)(NYSE:FCE.B) is trying to do is not easy, nor is it something that can be completely quickly. Once a high-leverage property developer, Forest City is looking to remake itself as a less risky, less leveraged, more diversified property operator and developer. Forest City has become a large presence in the hot Brooklyn market and still has opportunities to sell non-core assets and improve existing operations, not to mention possibly convert to a REIT structure. There are some reasons for caution (the Ridge Hill development, perhaps most prominently), but the shares still look undervalued today.

Deleverage, Derisk, And De-Diversify?

Forest City's efforts to reduce its leverage and operating risk make sense. Although the...

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