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kaptain_lou

kaptain_lou
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  • Retirees, You May Want To Add Preferred Stock To Your Dividend Growth Portfolio [View article]
    David, in the article you mention that you have some preferred shares of AGO. As you may have read in the news, AGO insures some debt of Puerto Rico and it appears that the island may default on some of their debt. What are your thoughts on the preferred now?

    For me, the preferreds of REITs are easier to value because most have balance sheets that are easy to read. The financials of insurance companies, such as AGO, are much harder to read - at least for me. Thanks.
    Jul 4, 2015. 12:03 PM | Likes Like |Link to Comment
  • Retirees, You May Want To Add Preferred Stock To Your Dividend Growth Portfolio [View article]
    David, it is interesting to note that CBL only trades at 2 times sales. This is a very low multiple for a REIT, but they do have a fair amount of debt.
    Jul 2, 2015. 09:28 PM | Likes Like |Link to Comment
  • Retirees, You May Want To Add Preferred Stock To Your Dividend Growth Portfolio [View article]
    David, good questions. I've been a CPA for over 20 years, so the financial analysis comes a little easier for me, but here are my answers:

    1) CBL debt is rated Baa3, so the preferred would be generally be rated two steps below. This should give investors a general idea of the rating.
    2) You can go to the SEC filings for CBL and print out the balance sheet page. Divide their total debt by the Cost of the buildings (and DO NOT back out the depreciation). If debt is 50% or less, than the preferreds are probably "safe" in my opinion. This generally works for REITs only. However, some REITs may have bought their properties years ago, so cost may not matter. But I do use this as a general rule of thumb.
    3) Yes, the common may be a better buy right now. However, as you mention in the article, the dividend could be cut on the common. The preferred is cumulative, so it would be hard to suspend the dividend on the preferred.

    At least for now, the preferred offers less downside potential. I may buy the common stock if the price drops lower, but REIT common stocks have not hit a bottom yet. Hope this helps.
    Jul 2, 2015. 09:24 PM | 1 Like Like |Link to Comment
  • Retirees, You May Want To Add Preferred Stock To Your Dividend Growth Portfolio [View article]
    David, great article for investors that are new to preferred stocks. Beside the basics, I think you hit on two key areas:

    1) Just because a preferred is unrated, does not mean the investment is not worthy of investment. Many companies just don't want to pay Moody's or S&P expensive fees to rate a preferred issue. I've been an investor in the preferred stock of UBP for years. The company is relatively small, but their balance sheet is solid.

    2) Preferreds that are callable at any time, but trading right around par are good investments now. They provide limited downside potential, due to the fact that they could be called at any time, but still a very nice stream of income. I recently purchased shares of CBL-PD at $25.10. Callable at any time, but they are trading with a little bit of accrued dividends. I'll collect over 7% and have an investment that should continue to trade around par.
    Jul 1, 2015. 09:49 PM | 1 Like Like |Link to Comment
  • WP Glimcher's Honeymoon Turned Into A Bad Dream [View article]
    While the REIT sector has been beaten down over the past two months, this is probably on of the author's best articles. Fair and balanced. The exposure to Sears and JCP is an area of concern, but the stock has been unfairly punished. Rents on those locations are clearly below market, but it will take time to get them rented as SHLD and JCP are closing many locations.

    I've been a fairly large holder of WPG-PH shares since the merger, but it is time to buy into the common stock now. Thanks for the article and for the insight on the company.

    KL
    Jun 13, 2015. 11:14 PM | 1 Like Like |Link to Comment
  • Investing In One Sucker Yield REIT Can Sink The Fleet [View article]
    As a side note, SIR's bonds of 2/1/25 are yielding about 4.9%. A nice secure play for fixed income investors. CUSIP 81618TAC4. Rated Baa2/BBB-.

    LXP is a steal at the present time with a yield of about 7.5%, which is covered by FFO. Thanks for the articles on the company.
    Jun 9, 2015. 10:55 PM | 2 Likes Like |Link to Comment
  • Investing In One Sucker Yield REIT Can Sink The Fleet [View article]
    Brad, thanks for the response. I really liked SIR before they took on the Cole properties. However, they do trade below book value and have been able to raise rents above inflation. Also, they still have a great credit rating of Baa2 - so I would respectfully disagree that they are highly leveraged. In addition, they recently raised the dividend from .48 per quarter to .50. While the credit rating agencies can be wrong from time to time, they do their homework.

    Their bonds are currently a great value and the pension fund I help manage will be picking up some of those bonds in the next 30 days. Hope this helps. Have a great week.
    Jun 9, 2015. 10:29 PM | 2 Likes Like |Link to Comment
  • Investing In One Sucker Yield REIT Can Sink The Fleet [View article]
    While the management of RMR has always been controversial, there does come a time when the assets of any company can be undervalued. This may be the time. The dividend of GOV and SIR appear to be covered by AFFO, and SIR has recently raised their dividend to .50 per quarter. While investors need to be diversified, a small position in either of these companies may provide decent returns in the future.

    I've subscribed to a monthly newsletter for 15 years, the Income Securities Advisor, which lists GOV and SNH as a buy. They DO NOT accept advertising from any outside companies and rely only on subscription revenue - so their research is never tainted.

    For fixed income investors, the bonds of SIR and SNH look extremely attractive at the present time. Both are investment grade and can be easily purchased.
    Jun 8, 2015. 09:38 PM | 5 Likes Like |Link to Comment
  • InfraREIT: Another Boundary-Pushing REIT [View article]
    I agree that the REIT structure is being taken advantage as well - such as the spinoff of Windstream's "real estate" into a separate company. While some of these companies are being creative, and are attempting to create value for shareholders, the end results remain to be seen.
    Jun 4, 2015. 08:14 PM | Likes Like |Link to Comment
  • Could Hospitality Properties Trust Become Another Sucker Yield REIT? [View article]
    rfritz - While RMR has been controversial, they do have good track record and I am very long on SNH now. RMR prefers to pay dividends instead of growth - which is fine with me. It's just another investment decision made by their management team.

    You may want to check out an old article by the author. It was written three years ago tomorrow and called "Why I don't own shares of REITs now" and was dated 6/4/2012. Up to that date, he had owned no shares in REITs. It is quite an eye opener.
    Jun 3, 2015. 10:25 PM | Likes Like |Link to Comment
  • Could Hospitality Properties Trust Become Another Sucker Yield REIT? [View article]
    While some investors do not like stocks managed by RMR, they do have a decent history of paying good dividends and investment grade balance sheets. This has been a great investment for long-term investors.
    Jun 3, 2015. 10:17 PM | Likes Like |Link to Comment
  • InfraREIT: Another Boundary-Pushing REIT [View article]
    Thanks for a good article on a unique play in the REIT sector. Some of these new REITs are really pushing the boundaries on what I consider a REIT - companies that own shopping malls, apartments, etc. CORR is another unique REIT, but they have recently sold back the one electric line that they own. However, CORR's preferred issue is worth a look.
    Jun 2, 2015. 10:04 PM | Likes Like |Link to Comment
  • Rich Valuations And Slow Growth Portend Danger For High-End Apartment REITs [View article]
    Dane, thanks for a great article on the pricing of apartment REITs. Clearly, many of the stocks are overpriced on a FFO basis. In the long run, these stocks should have little to no upside value, even with decent rent increases.

    It would certainly be tempting to short some of these REITs at the current level, if the bet can be hedged with options.
    May 31, 2015. 03:18 PM | Likes Like |Link to Comment
  • UMH Properties, Inc: Falling Oil Prices Could Lead To Falling Occupancy [View article]
    I am certainly not a member of upper management, but I do own preferred shares in the company.

    In regards to comment of 10% interest on a $35,000 mobile home, since you appear to have little to no knowledge of the MH industry: many buyers actually pay cash for MH properties, especially if they are older.
    Dec 27, 2014. 11:23 PM | 1 Like Like |Link to Comment
  • UMH Properties, Inc: Falling Oil Prices Could Lead To Falling Occupancy [View article]
    Poor article. UMH has been in the business for a long time, and they know what they are doing. Natural gas prices will have little to no effect on the company. There is plenty of need for affordable housing in PA.

    kaptain lou
    Dec 20, 2014. 09:16 PM | 3 Likes Like |Link to Comment
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