News
CYS Investments (CYS) Trades at Attractive Valuation with Double-Digit Dividend
June 19, 2013CYS Investments (CYS) trades below book and below peers' valuations, and the real estate investment trust yields a double-digit, sustainable dividend, making this company attractive to some investors despite the generally neutral stance on agency REITs, according to Daniel Altscher, Research Analyst and Vice President at FBR Capital Markets & Co. "The stock is trading a little bit above 90% of book value, which I think is pretty reasonable when you see a lot of their competitors trading maybe at 95%, closer to the book value. And I think the dividend will be sustainable for now, and an 11% dividend yield, I think that's relatively attractive for a stock trading at a 90% of book value, plus shares have lagged overall year to day...
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Parkway Properties Inc (PKY) Benefits from Office Rent Growth in the Sun Belt and Smart Acquisitions
June 19, 2013Parkway Properties Inc (PKY) is a turnaround company seeing rent growth in its office buildings in the Sun Belt, and continues to deliver by making smart acquisitions that fit into their strategy, says Alexander D. Goldfarb, Managing Director and Senior REIT Analyst at Sandler O’Neill + Partners, L.P. “If you look down the Sun Belt, Parkway (PKY) is benefiting hugely because there is low tax, pro growth, and you don’t have the macro hurdles that New York and D.C. are facing,” Goldfarb said. “This is a turnaround company with a new management that came in almost two years ago. They now focus on owning high-quality, desirable office buildings in the desirable submarkets in the Sun Belt, so places like Buckhead in Atlanta, Uptown in Charlotte, Westshore in Tampa, places where people are willing to pay more for rents...
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Two Harbors Investment Corp. (TWO) Exposed to Nonagency RMBS; Hybrid REITs Tied to Macro Improvement
June 18, 2013Two Harbors Investment Corp. (TWO) has large exposure to nonagency RMBS and the underlying improving home prices and delinquency rates, leading this hybrid REIT to post double-digit upside year to date as the overall economic environment seems to firm up, says Daniel Altscher, Research Analyst and Vice President at FBR Capital Markets & Co. “Two Harbors, which is actually my top pick, that stock is up 18% year to date. You’re really seeing the benefits there of the hybrid flexibility model, because those names are also tied to an overall improvement in the economy. A lot of these names own nonagency RMBS that was purchased during the crisis; a name like Two Harbors owns their book at $0...
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Starwood Property Trust (STWD) Expected to Ramp Earnings and Dividends After LNR Acquisition
June 18, 2013Starwood Property Trust (STWD) is becoming the go-to REIT for investors wanting to participate in the CRE space, as this name exhibits a sizable balance sheet, significant franchise value, solid global relationships and the capacity to engage in large transactions, such as its recent LNR one, says Daniel Altscher, Research Analyst and Vice President at FBR Capital Markets & Co. “One thing that separates Starwood from a lot of other names in the space is that they can take on an entire transaction. They can originate the entire transaction on their terms and then slice and dice into A notes, B notes, mezz pieces, keep what they want, ship off the rest to someone else who wants it...
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Simon Property Group, Inc. (SPG) Earns $1 Billion Free Cash Flow from Operations After Dividend and Capex
June 18, 2013Simon Property Group, Inc. (SPG) is showing tremendous earnings power with over $1 billion of free cash flow that the company is using to expand and improve their most productive shopping centers, says Alexander D. Goldfarb, Managing Director and Senior REIT Analyst at Sandler O’Neill + Partners, L.P. “Simon (SPG), [is] the big mall company; just a tremendous earnings machine, over $1 billion of free cash flow from their operations after dividend and after capex. They’re using that free cash flow to spend $1 billion a year on redevelopment, taking some of their most productive centers like Sawgrass Mills, like Copley, like Woodbury Commons just north of New York City, which they’re expanding and making them even better,” Goldfarb said...
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