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Opinions Paul Gardner, CFA
WPT Industrial REITWIR.UN.TOTOP PICKMay 29, 2018
Paul Gardner, CFAOwned
$13.86
Stock price when the opinion was issued
$26.81
As of Oct 19, 2021. Market Open.
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COMMENT
PAST TOP PICK
(A Top Pick Oct 19/20, Up 70%) It was taken out. Industrial real estate is hot. Pension funds keep raising money and need access to product. He has topped up a few others in the sector.
Robert LauzonOwned
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HOLD
It is being bought in an all cash deal. There is a nice spread for those that are willing to take advantage of the take-out. To move out, he would suggest US real estate traded in Canada – see his Top Picks today. Dream (DIR.UN-T) is another to take a look at.
Andrew MoffsOwned
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TOP PICK
Trades in USD and CAD. Implied cap rate is just under 5%. Focused on industrial space. Loves that space, tailwinds are immense. Yield is 4.0%. (Analysts’ price target is $24.08)
Andrew MoffsOwned
0
BUY
He is very bullish on it. It operates solely in the US. Canadian investors don't value these stocks appropriately and US investors don't typically come north of the boarder to buy real estate exposure. He thinks we are in the early innings of the industrial warehouse cycle. They have a growing fee income stream.
Andrew MoffsOwned
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BUY
One of his favourite investments. Assets are all in the US. Benefits from US exposure to e-commerce. Still cheap relative to NAV. Trades at a 5% discount. A great theme that you don't have to overthink. Likes management.
Paul Gardner, CFAOwned
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PAST TOP PICK
(A Top Pick Apr 30/20, Up 36%) Because it holds US assets, but the REIT lists in Canada, you can buy the cheapest US industrial REIT. Cap rate is 5.5%. Drop that to 5%, then this REIT is worth north of $18. They're doing the right capital allocation buying assets, yet also selling assets to partners. Likes the valuation. E-commerce will remain at current levels or rise, but not decline, so this is a major tailwind.
Andrew MoffsOwned
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TOP PICK
He loves industrial REITs because of e-commerce. Their holdings are all in the US. Interest rates are low, so refinancing is cheap. Best in class. (Analysts’ price target is $19.53)
Paul Gardner, CFAOwned
0
TOP PICK
This is the backbone and infrastructure of E-commerce and logistics. All the big box warehouses near airports are fully leased and they need more of it especially in major hubs. There are 100 properties in the US. They have good institutional support. They trade 10% less than some of their Canadian peers but 30% cheaper than the US peers. They are collecting 99% of their rents and renew leases at higher prices. Earnings and growth are there. It is a blue chip REIT. You can make 20% in the next 12 months. (Analysts’ price target is $14.82)
Robert LauzonOwned
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COMMENT
They collected 99.5% of rents in July, a great number. Leverage is high. They pay out 100% of their AFFO, so they won't raise their dividend. She likes this, but prefers Granite REIT.
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Premium contentTOP PICK
Though it trades in Toronto, WPT owns warehouses in the States. Basically, e-commerce stores stuff in these warehouses, and e-commerce has been roaring during this pandemic. Year-to-date, WPT inches slightly ahead of the TSX, but in the past month, the Toronto benchmark has climbed 3.3% while WPT has surged 5.5%. Analyst Andrew Moffs argues that WPT would perform even better if it wasn't trading in Canada. Despite that, he made it a top pick during the lockdown. Robert Lauzon applauds WIR's outperformance during those difficult months and continues to hold it too. Paying a near-6% dividend doesn't hurt. WIR trades at only a 6.1x PE and boasts revenue growth YOY of 25.75%. The REIT currently has six buy ratings and two holds with an average price target of $15.07, more than $2 above its current stock price. WIR is trading slightly above its 50- and 200-day moving averages.
He recently bought it and had been wanting it for a long time. He really likes the industrial REIT space. WPT is US logistics and industrial properties which has grown 22% in the last five years. It was small and grown to $1-billion cap. They own great assets. They have manageable leverage so they have room to grow. They can raise rents with 100% occupancy. There's growth in US industrials. Can WPT grow fast enough? That's the only question. (Analysts' price target: $14.87)