Send Message
View as an RSS Feed
  • Omega Healthcare Is A Classic Textbook Model Of Repeatability  [View article]
    When the rate increases come, I think higher yielding REITs will be more resilient than lower yielding REITs, just as junk bonds are more resilient to rate rises than high quality bonds of the same maturity.

    Regarding NRF, I don't do mortgage REITs, except as an occasional trade when I spot on that is mispriced relative to book value.
    Apr 9, 2015. 01:35 PM | 1 Like Like |Link to Comment
  • Omega Healthcare Is A Classic Textbook Model Of Repeatability  [View article]
    """I'm doing the exact opposite."""

    RAS, the 10-year treasury is at 1.9% today. At year-end 2013 it was just over 3%. In mid-2007, it was over 5%. Where will it be 6 months from now.

    The disappointing March jobs report was a temporary glitch, caused by cold weather in the northeast. The "tax reduction effect" of lower gasoline prices will bring back strong economic growth and strong jobs numbers in the second half. Unemployment is approaching the Fed's 5.25% critical level. It is hard to see the Fed not acting to raise rates in 2015. Some Fed board members are already talking about it. And it is hard to see any such movement by the not impacting REITs.

    The "bond proxies" (low-yielding large caps, including FRT (today's drop puts FRT in a downtrend by the RSI and MACD indicators) will be vulnerable. So will the triple nets (O and NNN), and some healthcares that are weighted with long-term, triple net leases (HCP, OHI?).
    Apr 9, 2015. 01:07 PM | Likes Like |Link to Comment
  • Omega Healthcare Is A Classic Textbook Model Of Repeatability  [View article]
    All 25 stocks on my REIT watchlist are down today. Some of the biggest drops are among "bond proxies" such as O, NNN, SPG, SKT, and FRT. Though the bond market is relatively unchanged, there seems to be some consern that continuing claims for unemployment came in lighter than expected.

    I'm thinking that it may be time to lighten up on my REIT holdings.
    Apr 9, 2015. 11:31 AM | 1 Like Like |Link to Comment
  • American Realty Capital: New CEO Sets Dividend Time Table  [View article]

    There are differing investment approaches. DGI investing relies heavily on the historic dividend record. With ARCP's short history, I am surprised you were in it in the first place.

    I regard myself as more of an opportunistic value investor, looking at analyses of both balance sheet and income statement data. This includes looking at analyst estimated data, such as future earnings. In the case of equity REITs, such as ARCP, I look at estimated FFO per share, and estimated NAV.

    Here is how ARCP compares with the DGI "darling", O:

    2015 FFO Multiple (Source: Yahoo)
    ARCP: 11 X
    O: 19 X

    NAV and Premium to NAV (Est NAV from Citi's latest weekly REIT report):
    ARCP: $9.32 - 7.6%
    O: $32.00 - 57.3%

    About the dividend from ARCP:

    1. After the announcement of a dividend is resumption, ARCP will trade higher, and,
    2. The current yield on ARCP is likely to exceed O's 4.4%.

    Disclosure: I am long ARCP, bought after the "crash'.
    Apr 9, 2015. 09:57 AM | 3 Likes Like |Link to Comment
  • Why You Should Go Long Royal Dutch Shell  [View article]
    One can claim foreign tax credits for a lot more than $600 (in a taxable account), if you -- or your accountant -- file Form 1116.
    Apr 8, 2015. 10:15 AM | Likes Like |Link to Comment
  • FT: Exxon has motive, firepower to jump Shell's bid for BG  [View news story]
    Fred, as someone who retired early from Mobil before the Exxon takeover, I agree with you 100%
    Apr 8, 2015. 09:03 AM | 2 Likes Like |Link to Comment
  • American Realty Capital: New CEO Sets Dividend Time Table  [View article]
    On a GAAP basis, there are nothing but losses. Same probably applies to taxable income:
    Apr 8, 2015. 08:07 AM | 1 Like Like |Link to Comment
  • Adversity Was Bittersweet For This REIT  [View article]
    An excellent lesson in the ups . . downs . . and ups . . of real estate.
    Apr 7, 2015. 08:30 AM | 1 Like Like |Link to Comment
  • Do I Smell A Bargain At The Dividend Factory Outlet?  [View article]
    Last I heard (you can confirm on website), Woodbury was owned by Simon Property, SPG.
    Apr 7, 2015. 07:44 AM | Likes Like |Link to Comment
  • Capital raise for Realty Income  [View news story]
    The dumping of 20 million shares at the close has caused some chart indicators to turn very negative. The daily MACD crossed the signal line to flash a negative trend. The RST dropped below 50, another negative signal. O opened on the down side, went to a daily high, and crashed lower at the close, for a kind of key reversal. It will be interesting to see what happens tomorrow, with the big block trade today out of the way.

    BigCharts (Marketwatch), shows 26.7 million shares trading in regular hours, and another 13.2 million after the close.
    Apr 6, 2015. 10:54 PM | 2 Likes Like |Link to Comment
  • Do I Smell A Bargain At The Dividend Factory Outlet?  [View article]
    From a technical viewpoint the charts are looking a little heavy, except for SPG, which will probably flare out soon. TCO and MAC are in confirmed downtrends by the daily MACD indicator, while GGP and SKT are borderline.
    Apr 6, 2015. 07:51 PM | Likes Like |Link to Comment
  • Do I Smell A Bargain At The Dividend Factory Outlet?  [View article]
    Tanger's 2 largest centers, aggregating 1.48 million sf, are both on Long Island. The Riverhead center is ideally located on the way to the Hamptons resorts. April through October, we are located less than 15 miles away and I can report that the parking lots are usually full on cloudy summer days when the beaches are less of an attraction. The parking lots are also usually full during the Christmas shopping season. My wife is a strong fan of Tanger and an avid shopper there. Riverhead is 99% occupied, according to the Tanger website. The newer Deer Park center is 95% occupied. Both are attractively laid out and the stores feature highly successful brands.
    Apr 6, 2015. 07:43 PM | 1 Like Like |Link to Comment
  • Do I Smell A Bargain At The Dividend Factory Outlet?  [View article]

    With the new dividend yield still at only 3.2% and the FFO multiple at over 17, SKT is already highly valued. But competitors, SPG, TCO, GGP, and MAC, all sell at higher FFO levels and with lower yields (except for MAC). It is my opinion that the large cap mall REITs, that is SPG, TCO, GGP, and MAC, are in a bit of a bubble at present that is driven by the low 10-year T-bond rate of 1.9%. After the correction comes, SKT may trade more in line with peers, as I believe that the mall operators (SPG, TCO, GGP, and MAC) face more risk from online sales than the outlet operators. Due to their lower yields, they also face greater interest rate risk.
    Apr 6, 2015. 07:31 PM | 3 Likes Like |Link to Comment
  • Capital raise for Realty Income  [View news story]
    As I write, 25 of 25 stocks on my REIT watchlist are up today. But, O is only up 0.46%, which is less than any other on the list except for SKT (+0.11%). (Coincidentally, SKT is the subject of an article today by Brad Thomas.)

    The timing of the stock suggests that O is taking advantage of the new demand that is coming from index funds.

    FWIW: My somewhat subjective reading of the price chart for O suggests a little "heaviness". If I were contemplating buying, I might nibble at around $49, where I see some support.

    But I'm not considering buying. The 10-year treasury is back down below 2%, and there is much more room for the yield to go up than down, IMO. Large cap, low-yielding REITs will be vulnerable when this happens. This applies more to those yielding under 3%, such as FRT, but it will also affect O at 4.4%. My preference is for higher yielding equity REITs, including SNH, HPT, and LXP.
    Apr 6, 2015. 12:01 PM | Likes Like |Link to Comment
  • SunEdison's Wind Ambitions Will Hold The Company Back  [View article]
    Agree. Argument that investment in wind will limit the opportunity in solar is very unconvincing. In the investment banking market today, through yield co's, there appears to be more than adequate capital to do both. Investment in both may be complementary, and may serve to stabilize the income outlook.
    Apr 6, 2015. 11:51 AM | Likes Like |Link to Comment