Latest Stock Buy or Sell?
Make More Informed Decisions!

Today, Joshua Varghese commented about whether GRT.UN-T, AP.UN-T, COLD-N, RUF.U-X, REI.UN-T, CAR.UN-T, HR.UN-T, DRG.UN-T, WIR.UN-T, D.UN-T, CWK-N, TCN-T, PLD-N, BAM-N, BPY.UN-T, CRR.UN-T, IIP.UN-T, SOT.UN-T, HBC-T are stocks to buy or sell.

COMMENT
Hudson Bay Co.
Closing stores should be part of their strategy. There needs to be more definitive action by the management team. Management understands how expensive it is becoming to run a traditional retail operation. Digital and e-commerce products are making it very competitive to run a business. The real estate they possess is very valuable and it may be put to better use than retail. The deal being offered to HBC-T is very low at just $9.45 per share -- the real estate is worth $30 per share alone not including the value of their inventory. He thinks the minority shareholders will feel the offer is far to low as well.
department stores
DON'T BUY

A small Canadian office focused REIT in North America managed by the Slate Group. They announced a big distribution cut to re-invest the money into the portfolio. He thinks this is a chronic issue in the space and thinks they did the right thing. From here the downside is relatively protected. The discount to NAV can close in the next two years, but he is not sure what the catalyst would be. He would stay on the sidelines.

REAL ESTATE
HOLD
InterRent REIT
Entry into Montreal? The management team is one of the best out there. They buy undervalued properties and get big uplifts. They have perfected in Ottawa and the GTO. Montreal is not a new market to them. Overall the residential market space is well favoured. The tech industry has spawned in Toronto and it is spreading across the country. There is a shortage of good quality housing across the country. The yield just above 3%, but you are really buying this for their growth opportunities.
property mngmnt / investment
HOLD
Competing against Costco & Walmart? Associated with Sobey's. The competition has been there for a while. Sobey's has been developing good partnerships including into delivery. The pressure that has come to retail outlets is coming to groceries as well. You will see stores to optimize space. Sobey's is already looking into this, he feels. Crombie owns the right real estate in the right markets and they have a good redevelopment plan. He would continue to hold.
property mngmnt / investment
COMMENT

In isolation BPY.UN-T is a great name. It trades at a large discount to NAV and pays a yield of 6%. He looks at other real estate stocks and he would favour owning the parent BAM-N. He prefers the parent as they collect fees from all the other entities. Now is a good time to own BPY.UN-T due to the discount to NAV and this lower interest rate environment. He would be cautious that they do hold a lot of retail shopping centres, which may require capital investment in the future.

REAL ESTATE
COMMENT

In isolation BPY.UN-T is a great name. It trades at a large discount to NAV and pays a yield of 6%. He looks at other real estate stocks and he would favour owning the parent BAM-N. He prefers the parent as they collect fees from all the other entities. Now is a good time to own BPY.UN-T due to the discount to NAV and this lower interest rate environment. He would be cautious that they do hold a lot of retail shopping centres, which may require capital investment in the future.

management / diversified
COMMENT
Prologis
Warehouse REITs? Industrial and warehouse assets have become a buzz phrase. Storing assets closer to retail consumers is a real thing. This requires companies to revamp their entire supply chain and warehousing is critical and it only represents about 5% of a retail cost -- it is still pretty cheap. He would favour PLD-N in the US. It is a little expensive right now. He likes them because they are exploring their own business model to help companies get better value for their space. Overtime this will lead to a better revenue stream for them.
investment companies / funds
PAST TOP PICK
(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.
REAL ESTATE
PAST TOP PICK
(A Top Pick Apr 01/19, Up 0.2%) He still really likes this holding. The market is a little worried about global growth. This is a real estate service company, so they are vulnerable to these concerns. However, they provide so many more services to help companies optimize their office space. The outsourcing of such services works well for them. Today is good entry value, he thinks.
REAL ESTATE
PAST TOP PICK
Dream Office REIT
(A Top Pick Apr 01/19, Down 0.7%) They are not very active in raising equity, so they are off the radar for many investors. The CEO is buying their stock in massive amounts. This is great signal of support for the future business opportunities. The Toronto office market is very strong. He would continue to hold this.
property mngmnt / investment
DON'T BUY
It has traded range bound, but has a decent yield. The free cash flow per share has done nothing during the strongest industrial market in years. They keep coming back to the market to raise equity to buy more assets. He would like to see them pause on the equity raising. There are other REITs that have better growth opportunities. Yield 5.6%
0
BUY
An office focused REIT with assets in Germany and the Netherlands. He is not a fan of the parent organization, but is not a huge concern. Vacancy rates in Germany are less than 4%. He sees good office rental growth opportunity, which is averaging 7% per year. There is still room to run.
REAL ESTATE
BUY ON WEAKNESS
A big company that owns some good assets and a safe dividend yield. He would range trade this and is not clamoring to step in right now.
property mngmnt / investment
DON'T BUY
It has benefited from population growth in the residential housing space. They own assets across Canada. He thinks they may become a major take out target. Their free cash flow yield is pretty low, around 3%, so he thinks there may be better opportunities out there.
investment companies / funds
BUY ON WEAKNESS
He thinks they are doing the right things. They have recognized the future of real estate is going to be into urban clusters -- coming office with retail and residential. They disposed off assets that did not fit the plan. The proceeds will be use to buy back stock and spending capital into new development opportunities. He would buy on weakness.
property mngmnt / investment