Tricon Capital Group

A REIT specializing in raw land Where? Long-term holdings of land can be lucrative--depending on location. Raw land is no good as a bond proxy--no income and you pay expenses. There are few public land development companies. Tricon and Howard Hughes (a past top pick) will give you some exposure and are well-run.

It's been rangebound, so consistently in the past three years. Given this, you can buy at the support level around $9, then sell at $11-12 (resistance). Point is: you can trade this. Now, it's right in the middle. So, don't jump on it, not worth a buy or sell. So, wait.

(A Top Pick Dec 05/18, Up 15%) They hold single-family rental homes. They confused investors last summer when they bought some apartments, but long term this is a good strategy, because they're trying to create an asset management platform. They would be the asset manager, raise third-party capital and collect a fee on them. This confusion has pressured the stock, but the stock has since rebounded.

A large holding for him in the rental residential space. Single family rentals. You can rent a house, cheaper than renting an apartment. It is currently trading at a 20% discount to NAV, so there is some great capital growth opportunity as well. Yield 2.56% (Analysts’ price target is $13.06)

It's been rangebound around $8-11. It yields 3%, less than its peers. It's a corporate real estate investment trust, so the payout ratio and dividend are lower. A serial acquirer but they often dilute shares. Maybe they are following BAM's lead by managing 3rd-party assets which may lead to better operational leverage and a re-rating to the asset manager part of the business. A high-quality company.

He likes this company and its management. They are into residential in the US -- single family homes for rent as well as the apartment business. They just purchased a company for residential apartments and there are now a lot of new shareholders into their stock, causing some indigestion and he saw this as a great buying opportunity. You should still see a couple of dollars of upside in the net asset value of this company.

A multi-family residential home developer mostly in the US. The real estate sector has down well this year as most REITs are up about 15%. There is a block of stock that he expects to come into the market, so it could put a cap on things. It trades about 20% discount to NAV, so he sees that as its upside over the next 18 months.

The Starlight buy allowed TCN-T to expand apartment rentals in the US to be added to their single-family for rental portfolio of holdings. They were able to issue stock to the Starlight holders at very high values to bring them in -- a very smart strategy. This created a large overhang of shares that could hurt share prices. Recently TCN-T removed the overhang to allow them now to sell those shares unrestricted. Investors on the sidelines appear to have sopped up the surplus. The only reason it was not a Top Pick, is that he was blind sided by the share announcement. His discussions with the management team about the US acquisition is solid, he thinks. He likes the valuation of the company, he thinks it could be worth $13 per share.

They've done an excellent job getting into the single-family rental business in the U.S. with a lot of demand and rental rates moving up. TCN has done some fine acquisitions and it still trading at a reasonable multiple. US and global investors are down on Canada, given the poor oil situation, so investment hurts mid-cap companies like TCN, even though TCN's business is in America. Be patient with this.

Outstanding management team. They did a couple of large transactions that the market is still working through. They got into rental of homes in the US and bought high quality apartments in the US sunbelt. There is some short term pain as some believe the debt has gotten a little too high. In the real estate space the leverage is not out of normal ranges.

(A Top Pick Apr 01/19, Down 12%) Two days after making the pick, the company announced an acquisition that the market did not like. They are the premiere owner of single family rental properties in the US. They are investing a lot of money into technology for the sector. They are looking to expand their platform of properties -- great in the long term. The market didn't like the departure from the existing business model. It is trading at a massive discount to NAV, so he still likes the value.

A very solid company. The announced a major acquisition and since then the stock is down about 10%. They bought 23 multi-family buildings. He thinks they are trying to expand their model from single-family to multi-family units. At this level, it is less than 10 times earnings and the yield is 2%. He would be a buyer here.

(A Top Pick Apr 26/18, Up 8%) They have exposure to the US residential market and pay a good dividend. They have an asset management group that generates good cash flow. He thinks the market is undervaluing this.