Mid-America Apartment: Sunbelt Compounder At A Discount

Summary

• Mid-America shares have declined 25% over the past year as investors have shunned REITs as interest rates have risen.
• Mid-America has generated fantastic long-term returns for shareholders. The company remains well-positioned to demographic trends.
• Despite a near-term increase in apartment supply, Mid-America is poised to produce record results in 2023.
• At 17x 2023e FFO, an implied cap rate of 5.7%, and 3.6% dividend yield the current share price offers an attractive entry point for conservative long-term investors.

AlbertPego

Mid-America Apartments (NYSE:MAA) was not spared from the carnage in apartment REITs with shares declining 25% over the past year. Investors are likely concerned about higher interest rates, slowing rental rate growth, and fears of looming increases of new sunbelt apartment supply.

Analyst’s Disclosure:I/we have a beneficial long position in the shares of MAA either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.