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Opinions Michael Missaghie
Dream Global REITDRG.UN.TOCOMMENTNov 20, 2013
Michael MissaghieStock price when the opinion was issued
As of Dec 11, 2019. Market Open.
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Jaime CarrascoHis favourite REIT, because most of the cash flow is coming from Europe, and he wants to generate more cash outside Canada. (Analysts' price target: $15.54)
Jaime CarrascoInovalis (INO.UN-T) or Dream Global (DRG.UN-T)? There is probably too much duplication to own both. Management has done a very, very good job since the IPO. They’ve grown through acquisition and have diversified. They own an institutional quality portfolio, and thinks they have an opportunity to grow in continental Europe. Their assets are primarily in Germany. Instead of buying Canadian names that have exposure to Europe, he is actually going directly into Europe and buying some names.
It is a decent name if you own it. It is tough to switch out of it. He has preferred names including a top pick today. Management promised to diversify the portfolio and they did a good job of that. The payout ratio is high so this is why he is cautious on it. There are risks in the devaluation of the Euro. He does not think they will have to cut the dividend.
Came to the market a couple of years ago and focused on acquiring office properties in Germany. A unique Canadian REIT that invests solely outside of Canada. Have done a good job of decreasing their exposure to Deutsche Post, which was their largest tenant on the IPO. This has come down to about 40% of their portfolio. Trading at a slight discount to its NAV. This will give you a sustainable yield but there will be a fair bit of uncertainty regarding some of the lease terminations and their ability to fill the vacancies and this will be in the determination of their growth going forward. 9.1% dividend yield.