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An Inside Look At The 'Smoking Hot' Retail Opportunity Investments Corporation
- Check out this video interview with Stuart Tanz, CEO of Retail Opportunity Investments Corporation.
- This REIT is as hot as a firecracker and given the CEO’s (Stuart Tanz) drive for success, I suspect ROIC will top $20 by year-end.
- ROIC is a solid REIT that trades at sound value (P/FFO of 18.1x).
Tanger Is A Highly Predictable Dividend Machine
- As the retail industry has evolved, Tanger was the first to grasp the retail distribution channel in which goods could enjoy a longer life cycle than the traditional clearance concept.
- Earlier this week, I caught up with Tanger's CEO, Steve Tanger, to discuss his company's first-quarter earnings and its enviable brand of dividend repeatability.
- Ben Graham has trained me to spot a bargain and although Tanger has a bargain-based model of repeatability, the shares don't indicate there's a sale today.
HTA Delivers On Its Dedicated Management Model
- As a result of the increased asset management and leasing platform, HTA is doing a majority of leasing and negotiations directly with tenants, reducing the overall cost paid to third-parties.
- While visiting with members of the company’s executive management team I was able to meet with Amanda Houghton, Executive VP of Asset Management.
- As further evidence of HTA’s improving circle of competence S&P recently upgraded HTA’s investment grade credit rating to BBB, with a stable outlook.
Schorsch Hooks A Big Lobster
- Darden has a lot of real estate on the balance sheet - around 63% of assets - and that seems to be a significant element for the fortress-like brand.
- The only REIT that could possibly take down Red Lobster's real estate (by itself) is American Realty Capital Properties.
- Today ARCP announced that it had entered into an approximate $1.5 billion sale-leaseback transaction for over 500 Red Lobster restaurant properties.
This REIT 'Had Me At Hello'
- It's rare that I give a rookie REIT the thumbs up on the first date; however, as Jerry Maguire said, "you had me at hello".
- What impressed me most about ROIC is that the company started as a “blank check” Initial Public Offering, meaning that the REIT commenced with no assets and lots of cash.
- ROIC’s FFO on a per-share basis also increased, notwithstanding a sizable increase in the shares outstanding due to over 21 million warrants being exercised since the beginning of 2013.
- Although not a polished jewel then, my impulse told me that ROIC was going to be a big time contender.
Why Does Mr. Market Fear American Realty Capital Properties?
- This is no fairy tale, especially when we are dealing with real money. This is not monopoly and I have a lot riding on ARCP.
- ARCP’s latest quarter was significant based upon the fact that the New York-based REIT has demonstrated its synergistic complexities becoming simpler.
- Since there is no operational risk associated with single-tenant investing, much of the net lease business is more about math than science.
- Mr. Market does not comprehend the potential for ARCP and it clearly underestimates the rewards for growth.
Solid Quarter For This Life Science REIT
- Capital raising was spectacular in the first quarter with more than $23 billion of biotech financing and partnering transactions, again ahead of what was a very strong 2013 level.
- Since going public almost ten years ago (August 4, 2004), BioMed has been able to carve out a growing niche and now the company has evolved into a highly innovative landlord.
- I moved out of all of my shares in Medical Properties Trust due to under performance and increased competition in the hospital sector.
WPT Industrial Is A High-Paying Canadian REIT That Pays Monthly
- One of the reasons that WPT listed on the Canadian exchange was the fact that the company could achieve more "shelf space" in Canada than in the US.
- Based on US standards, WPT is a highly leveraged REIT.
- WPT is trading at cheap valuation of 9.8x Price-to-Funds from Operations (P/FFO).
Why Should You Maintain A Balanced Diet Of REITs?
- Great salsa is all about diversification. Only by adding diverse ingredients together can we achieve the desired outcome.
- REITs have been around long enough (5 decades) and generated solid enough returns that I don't view REITs as an alternative class.
- Since the emergence of the modern REIT structure, dividends have been a large factor in the outperformance of REITs relative to the broad equity market.
Healthcare Trust Of America Is As Pure As The Driven Snow
- As a "pure play" REIT, HTA is a dedicated owner of medical office buildings, with a portfolio of 114 buildings (and over 14.1 million square feet) in the 27 states.
- HTA ended the quarter with excellent credit metrics, with debt-to-enterprise value of 31%, one of the lowest in our peer group, and debt-to-proforma EBITDA of 5.3 times.
- This is a "pure play" bet that's paying off, and I believe the price could hit $13.00 – especially "when there's a dividend increase.".
What Is Your Risk Tolerance With American Realty Capital Properties?
- If you're unwilling to take the chance that an investment that might drop in price, you have little or no risk tolerance.
- Risk tolerance simply describes whether you invest in real estate, stocks, the quarter slot machine, high stakes blackjack, or stay at home with a piggy bank – or maybe a.
- I believe that the market has demonstrated that ARCP has a high degree of risk and as we saw this week, a simple acquisition rumor caused shares to slide.
Why It's Important To Own Predictable REIT Stocks
- The dividends that REIT investors receive out of earnings haven't been reduced by taxes at the corporate level, making REITs tax-efficient conduits for real estate income.
- Over the past 20-plus years, listed equity REITs have provided 30% more dividend income than small-cap value stocks in the Russell 2000V, with 43% less variability.
- Many REITs are now increasing dividend payouts, and that’s the best possible evidence that the security is safe and management has an alignment of interests.
The Smallest Health Care REIT That Pays The Highest Dividend
- When it comes to health care investing, DOC is a like a “kid in a candy shop.”.
- DOC targets unleveraged investment returns between 7% and 10% and the company has in excess of $300 million of investment properties under review.
- DOC's current dividend yield is 6.72% - the highest yield in the Health Care sector.
- DOC’s IPO and secondary offering (in December) were oversubscribed by a significant amount and over 60% of the company’s shareholders are Institutional Investors.
Ventas Posts Another Solid Quarter And Enters The United Kingdom
- After the broad REIT sell-off last May, it seems that Mr. Market has finally begun to recognize Ventas for its "blue chip" credentials.
- In the latest quarter, Ventas increased its cash flow by over 23% (since last year).
- I would recommend buying Ventas shares on market weakness (under $60).
- For an investor looking for "big 3" health care REIT exposure today, I believe that HCP represents the best opportunity.
Don't Follow The Herd, Consider STAG Instead
- In the world of investing there is a natural tendency to "follow the herd" and become fixated on the irrational exuberance of the market.
- Given STAG's strong growth prospects and having switched to a monthly distribution, it seems likely that the company’s dividend expansion will grow in frequency.
- By following the herd, some market timers may look at the one-time slide last week as weakness.
- I believe STAG represents a strong buying opportunity and I'm moving my TARGET price to $25.00.
Ramco-Gershenson Is A REIT That Could Bounce Or Be Bought
- Ramco-Gershenson is trading at $16.16 a share with a Price to Funds from Operations (P/FFO) multiple of 13x. That’s around 15% below the peer average of 15.5x.
- What’s even more interesting to me is the fact that Ramco-Gershenson is what I call a “tweener.”.
- In REIT-dom the shopping center sector is getting crowded.
- This REIT is “ripe” for a “combination” and the shares are somewhat attractive.
The REIT Way To Invest In A Wide Moat Of Dividend Repeatability
- The larger moats could enhance the defensive strategies and allow the royal families to remain competitive in battle.
- Warren Buffett has used the term "wide moat" at least 20 times since 1986 to describe his investment process in annual letters to Berkshire Hathaway shareholders.
- Companies with wide economic moats have a better chance of long-term survival, and they also help to protect revenue streams, profitability, and market share.
- Much like the evolution of fortresses, REITs have also evolved (over 5 decades) into an asset class with wider economic moats that enjoy a better chance of long-term survival.
What's The Probability That This Dark Horse REIT Wins?
- In any “dark horse” race, the odds for Lexington to outperform were high, but I was convinced that there were “probability distributions” that could lead Lexington to grow.
- I was predicting that Lexington would be ahead of the game by now.
- Clearly Lexington has the cash flow to pay out a higher dividend but instead the company has opted to prudently retain cash to reinvest and pay down debt.
- It’s an endurance contest where the winners and losers are separated because they pick stocks with above-average appreciation potential and safe and growing dividends, and buy them at attractive prices.
It Seems Like Groundhog Day: Omega Bumps The Dividend Again
- In early January Mr. Market gave me the opportunity. I pounced on Omega shares at $29.80, just a few nickels below my target price.
- Last week Omega announced that it was increasing its common dividend by $.01 per share over the previous quarter.
- That’s beginning to sound like “groundhog day” for Omega since this makes the seventh consecutive quarterly dividend increase - raising the dividend from $0.49 per share to $0.50.
- So although some might consider 7 quarterly dividend increases boring, I find it quite satisfying.
Is There Adequate Bench Strength For Digital Realty?
- When it comes down to succession planning, it’s critical that each company has “bench strength.”.
- With no CEO, I feel kind of like the cruise ship passenger.
- The key question for me is making sure that the ship sails smoothly until the new CEO is steering the vessel.
- So I suppose I could jump off and redeploy the capital into a safer boat, one that has a captain.
HCP Is Climbing Back Up, Should I Get Back In The Game?
- It seems that Mr. Market may have found a bottom for HCP, and now, maybe it's time to get back in the game?
- There aren't too many REITs with that track record, especially HCP that boasts a record of 29 years of consecutive dividends paid.
- When selecting sound securities, one needs some kind of buffer to protect against market fluctuations – a margin of safety.
- Last year, we saw HCP's price rising, and as we often recognize, greed leads investors to speculate, to make substantial, high-risk bets based upon optimistic predictions.
Oh, Ho, Ho, It's New York REIT, You Know
- Today, Nick Schorsch takes the stage again in his 6th liquidity event, and this magic is close to home in New York City.
- NYRT offers a compelling value proposition in that this REIT is the only "pure play" REIT focused exclusively on New York City real estate.
- This is one of the few times that I have recommended a BUY price on the first day of listing.
I'm Buying W.P. Carey For The Long Haul
- S&P recently provided WPC with a strong credit rating.
- WPC increased its quarterly cash dividend to $0.895 per share, which equates to an annualized rate of $3.58.
- Carey’s 15-year track record for dividend performance “seals the deal.”.
Why I'm Strongly Considering A Position In Extra Space Storage
- I often voice my disfavor for analysts, authors and investors who try to pitch some confusing thesis for a stock that is predicted to achieve high returns with short-term trades.
- Some of you may remember the 1982 new wave hit song (by Thomas Dolby), She Blinded Me With Science.
- I intend to establish a position in Extra Space at $45.00, although I have no confidence when I’ll be afforded that opportunity.
The REIT Way To Master The Art Of Dividend Repeatability
- In order to score at Golden Bell, a player must catapult his tee shot high in the air, pray that winds are down, and ski-dittle the ball.
- Although I can’t attest to having a terrific scorecard, most pro golfers believe that distance is a much better indicator than accuracy.
- The Great Recession reshaped the roster of dividend champions, especially in the financial sector.
- When you see the history of "repeatability" forming, you must then look at the dividend growth prospects and pinpoint this with the fastest expected Funds from Operations (or FFO) growth.
Campus Crest Looks Cheap, Should I Hit The Buy Button?
- Since my article in February 2013 it’s clear to see that Mr. Market saw no “zest” for Campus Crest.
- I believe there’s more value in owning the common shares today that are priced at $8.62.
- Considering that this REIT pays out over 90% of its FFO, I’m not calling this a table pounding BUY.
Schorsch Creates More Magic, This Time It's Health Care
- I have often referred to Nick Schorsch as the Houdini of REIT listings for incubating Non-Traded REITs.
- Companies like VTR and HCP are almost forced to grow in order to feed the engine. It would seem logical that HCT would be a strong candidate for Ventas’s feeding.
- Pound for pound, I believe that Ventas is the BEST Health Care REIT today and I don’t believe the risk premium of HCT warrants the return.
- It’s clear that Nick Schorsch has more magic to come and I can’t wait for the next act.
Weingarten Has Evolved Into A More Lasting Model Of Differentiation
- Weingarten has transformed its investment model by focusing on markets with strong demographics including solid rent growth, educated employment, and high density locations.
- As part of the focused reinvestment strategy, Weingarten has substantially increased its shop occupancy from 85.6% in 2010 to 89% in 2013.
- Weingarten has returned 11.3% to shareholders over the last 90 days and I believe that the stock will see more momentum this year.
Realty Income: One Heck Of An Ark That's Prepared For The Storms Ahead
- The Noah Rule: "It is not enough to know it is going to rain, you have to actually build the ark!”.
- One essential element for Realty Income’s battleship blueprint has been to match fund its investments with its long-term liabilities.
- You cannot escape risk. All you can do is prepare and manage for it.
Will Chambers Street Benefit From This Historic BMW Announcement?
- The Spartanburg-based plant expansion is set to overtake BMW's largest plant, which is currently outside of Munich and builds about 340,000 cars a year.
- As BMW expands its operations in the area, Chambers is likely to benefit from the expansion needs of many of the company's current tenants.
- Chambers Street's current dividend yield is 6.49%. That's an attractive yield, and based upon the peer group, I believe that this REIT is one of the best Net Lease opportunities.
Can Healthcare Trust Of America Withstand A Lickin' And Keep On Tickin'?
- Since I started accumulating shares (August 21st), HTA has returned 14.73%, beating the S&P 500 (14.5%) and most other REIT peers.
- As healthcare utilization increases, there will be an increase in the need for all types of providers, including doctors and on-physician workers.
- HTA has demonstrated a growing track record of consistency and a dividend increase to me implies that the earnings stream (and dividends) can withstand a “lickin' and keep on tickin'."
Finally, A Pay Day For Gramercy Shareholders
- After a hiatus of more than five years, Gramercy announced that the company was resuming its dividend payment to common stockholders (beginning with the first quarter of 2014).
- I was hoping to see more “meat on the bone” for Gramercy’s new dividend; however, it’s plain to see that this Triple Net REIT is in a strong growth mode.
- Gramercy looks like a small cap REIT that can continue to grow its footprint, possibly doubling in size in one year.