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Investor Insights

This summary was created by AI, based on 3 opinions in the last 12 months.

Dream Residential REIT (DRR.UN) has consistently struggled to reach its IPO price, leading to skepticism among analysts regarding its potential as a long-term investment. Despite a substantial portfolio of properties in the US, there is concern that the REIT may be too small for significant consideration at this juncture. The current market dynamics, particularly in relation to new constructions and supply-demand challenges, indicate a wide discount to net asset value (NAV). In comparison to competitors like DIR.UN, which boasts stronger internal growth prospects and better positioning regarding rental rates, DRR.UN's situation appears less favorable. Experts advise monitoring the REIT closely as it pursues strategic alternatives, which could influence its future valuation and market standing.

Consensus
Negative
Valuation
Undervalued
HOLD

Focused on assets in US. Has never traded above its IPO price. Pursuing strategic alternatives; if you own it, see how those go.

BUY

Large ownership of US properties. Too small to own at this point, but very cheap stock that could have a lot of value. 

DON'T BUY
DRR.UN vs. DIR.UN

He focuses on supply and demand, and then goes bottom-up looking for discounts. Fundamentals in industrials in Canada and Europe are far superior today to US multi-family, especially in the Sunbelt. 

It's a new construction supply problem, and demand won't be able to keep up. DRR.UN owns an older portfolio in key Sunbelt markets. Wide discount to NAV. Low liquidity, so no premium.

DIR.UN has stellar internal growth prospects. Spread between in-place rents and market rents gives them an advantage. He'd choose this one. New construction will fall off 15% into next year, and empty space will be absorbed.

TOP PICK

It has garden style town homes and apartments in Texas and Cincinnati. It appeals to middle class renters and could get rent increases. It is trading below its NAV by over 30% so is mis-priced. Its payout ratio is 65% to70% so the dividend of 6% is safe.     Buy 7  Hold 1  Sell 0

(Analysts’ price target is $12.56)
BUY ON WEAKNESS
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research

DRR.UN is a small-cap REITs focusing on residential properties, and is now trading at 8.2x times' Forward P/E. The company owns a portfolio of properties with a high occupancy level of 98%. Trading at a meaningful discount to NAV of $17. In the last few years, the company managed to grow distributions per share and NAV per share at attractive rates. Having said that, the balance sheet is highly leveraged, net debt to adjusted EBITDA is around 9.0x, and available liquidity is around $243M. However, the total debt service requirement amount for the remainder of 2023 is $131M, and 2024 is around $350M. The company's small size and leverage add significant risks if the economy/fundamentals were to falter.  Payout ratio (12 months). As a new small public company, in a higher interest rate environment, we think investors can wait and watch this one and see how it performs as a public entity. We think buyers have time here. 
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HOLD

Newer REIT. Apartment buildings in the US. Rents are lower, assets are older. Small. Trades at a nice discount. Pretty attractive cap rate of 7.7%. Other REITs are larger, more liquid, with more institutional-quality real estate. Decent hold, but better opportunities elsewhere.

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Dream Residential REIT(DRR.UN-T) Rating

Ranking : 3 out of 5

Star iconStar iconStar iconStar empty iconStar empty icon

Bullish - Buy Signals / Votes : 1

Neutral - Hold Signals / Votes : 1

Bearish - Sell Signals / Votes : 1

Total Signals / Votes : 3

Stockchase rating for Dream Residential REIT is calculated according to the stock experts' signals. A high score means experts mostly recommend to buy the stock while a low score means experts mostly recommend to sell the stock.

Dream Residential REIT(DRR.UN-T) Frequently Asked Questions

What is Dream Residential REIT stock symbol?

Dream Residential REIT is a OTC stock, trading under the symbol DRR.UN-T on the (). It is usually referred to as or DRR.UN-T

Is Dream Residential REIT a buy or a sell?

In the last year, 3 stock analysts published opinions about DRR.UN-T. 1 analyst recommended to BUY the stock. 1 analyst recommended to SELL the stock. The latest stock analyst recommendation is . Read the latest stock experts' ratings for Dream Residential REIT.

Is Dream Residential REIT a good investment or a top pick?

Dream Residential REIT was recommended as a Top Pick by on . Read the latest stock experts ratings for Dream Residential REIT.

Why is Dream Residential REIT stock dropping?

Earnings reports or recent company news can cause the stock price to drop. Read stock experts’ recommendations for help on deciding if you should buy, sell or hold the stock.

Is Dream Residential REIT worth watching?

3 stock analysts on Stockchase covered Dream Residential REIT In the last year. It is a trending stock that is worth watching.

What is Dream Residential REIT stock price?

On , Dream Residential REIT (DRR.UN-T) stock closed at a price of $.